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5 June, 17:37

Marvin Services Corporation had the following accounts and balances: Accounts payable $ 6,000 Accounts receivable 8,000 Cash 7,000 Common stock 15,000 Equipment 44,000 Notes payable 8,000 Prepaid insurance 4,000 Retained earnings Not given Supplies 2,000 Unearned service revenue 3,000 What is the balance of the company's retained earnings account? $34,000 $28,000 $46,000 $26,000 $33,000

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  1. 5 June, 17:50
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    The balance of the company's retained earnings account is $33,000

    Explanation:

    The computation of retained earning balance is shown below:

    = Assets - Liabilities - shareholder equity

    where,

    Assets = Accounts receivable + Cash + equipment + prepaid insurance + supplies

    = $8,000 + $7,000 + $44,000 + $4,000 + $2,000

    = $65,000

    Liabilities = Accounts payable + notes payable + unearned service revenue

    = $6,000 + $8,000 + $3,000

    = $17,000

    And, the common stock is $15,000

    Now put these values to the above formula

    So, the answer would be equal to

    = $65,000 - $17,000 - $15,000

    = $33,000
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