In Working with Schedule M-2 (Analysis of Unappropriated Retained Earnings

question 104

Multiple Choice

In working with Schedule M-2 (analysis of unappropriated retained earnings per books) of Form 1120, which of the following is an addition to beginning retained earnings?

• A) Cash dividends.
• B) Net loss per books.
• C) Property dividends.
• D) Net income per books.
• E) None of the above.

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Definitions:

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, indicating the net value owned by the shareholders.

Loan

A sum of money that is borrowed and expected to be paid back with interest by the borrower to the lender.

Accounting Equation

The foundational formula in accounting that states assets equal liabilities plus owners' equity, essentially showing what the company owns is financed by debt and shareholders' equity.

Land Sale

A land sale involves the transaction where ownership of a piece of land is transferred from one party to another, typically involving legal documentation and financial compensation.