The Amount of Retained Earnings Appearing on the December 31

question 29

Multiple Choice

The amount of retained earnings appearing on the December 31, 2018 consolidated balance sheet would be:

• A) $384,000.
• B) $396,000.
• C) $400,000.
• D)$402,400.

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Definitions:

Net Income

The final profit figure for a company after deducting taxes and expenses from the revenue.

Dividend Payout Ratio

The dividend payout ratio is the fraction of net income a firm pays to its shareholders in dividends, expressed as a percentage of the company's total net income.

Retained Earnings

The portion of net income that is retained by the company rather than distributed to its shareholders as dividends.

Profit Margin

A financial metric that measures the percentage of revenue remaining after all expenses have been deducted from sales.