On the Statement of Retained Earnings

question 25

Multiple Choice

On the statement of retained earnings:

• A) there will be a positive balance in retained earnings if historically expenses have exceeded revenues.
• B) a deficit will result in retained earnings if historically, expenses have exceeded revenues.
• C) any dividends paid during the year will increase retained earnings.
• D) a deficit in retained earnings indicates the company has no cash.

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Definitions:

Germ Layer

One of the primary layers of cells (ectoderm, mesoderm, and endoderm) in the early embryo from which all tissues and organs develop.

Digestive Tube

A continuous hollow tube running through the body, from mouth to anus, where digestion and nutrient absorption occur.

Ectoderm

The outermost layer of cells or tissue of an embryo in early development, giving rise to the outer layer of skin, nerves, and brain.

Germ Layer

One of the primary layers of cells (ectoderm, mesoderm, or endoderm) in the early embryo that will differentiate into various tissues and organs.