A Corporation Began the Current Year with $250,000 of Unappropriated

question 133

Short Answer

A corporation began the current year with $250,000 of unappropriated retained earnings.During the current year it earned $120,000 of net (after-tax) income,declared $75,000 of cash dividends,paid $50,000 of the cash dividends and purchased treasury stock costing $40,000.Calculate the current year-end balance in retained earnings.

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Definitions:

Defense Mechanism

A defense mechanism is a psychological strategy unconsciously used to protect a person from anxiety arising from unacceptable thoughts or feelings.

Projection

A defense mechanism where an individual ascribes their own unwanted thoughts, feelings, or motives onto another person.

Dishonest Tax Returns

The act of knowingly providing false information on a tax return to reduce tax liability, which is illegal and subject to penalties.

Defense Mechanism

Psychological strategies brought into play by individuals, groups, or even nations, to cope with realities and to maintain self-image by concealing the motivations behind one’s behavior.