The Income Statement for Dodson Corporation Reported Net Income of $22,400

question 82

Essay

The income statement for Dodson Corporation reported net income of $22,400 for the year ended December 31 before considering the following:
$\bullet$ During the year the company purchased available-for-sale securities.
$\bullet$ At year end, the fair value of the investment portfolio was $2,100 more than cost.
$\bullet$ The balance of Retained Earnings was $83,000 on January 1.
$\bullet$ Dodson Corporation paid $9,000 in cash dividends during the year.
Calculate the balance of Retained Earnings on December 31.

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Definitions:

Decision Making

The cognitive process of selecting a course of action among several alternatives to achieve a desired outcome.

Reasoning

refers to the cognitive process of looking for reasons, engaging in logical thinking, and arriving at conclusions based on premises.

System II Thinking

A cognitive process that involves analytical, effortful, and logical thinking as opposed to quick, instinctual, and often biased System I thinking.

System I Thinking

A term from dual-process theory referring to fast, automatic, emotional, and subconscious thought processes.