The Following Accounts and Balances Were Drawn from the Records

question 75

Multiple Choice

The following accounts and balances were drawn from the records of Carolina Company on December 31, Year 1: The amount of Carolina's retained earnings after closing on December 31, Year 1 was:

• A) $5,900.
• B) $7,200.
• C) $3,900.
• D) $4,900.

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Definitions:

Income

The financial gain earned by an individual or a company, usually measured over a specific time period and derived from various sources like sales or investments.

Construction Expense

Costs directly related to the construction of a building or infrastructure, including materials, labor, and other expenses incurred during the process of building.

Percentage-Of-Completion Method

An accounting technique used to recognize revenue and expenses of long-term contracts as a percentage of work completed during the period.

Actual Construction Costs

The total expenses incurred during the construction of a building or infrastructure, including materials, labor, and any other costs.