If Mookie had Retained Earnings of $88,000 at the end of year 5, what was the company's Retained Earnings at the beginning of Year 1?

A.$13,000.

B. $25,000.

C. $7,000.

D. $1,000

Answer: A. $13000

During its first five years of operation, Mookie Consulting Services reported the following annual net income and dividend amounts:

Year Net Income Dividends

1 $22,000 $2,000

2 17,000 2,000

3 9,000 1,000

4 14,000 3,000

5 25,000 4,000

If Mookie had Retained Earnings of $88,000 at the end of year 5, what was the company's Retained Earnings at the beginning of

Year 1?

a. $13,000 d. $41,000

b. $23,000 e. some other amount

c. $37,000

Explanation: the difference between total dividends (75,000$) and total net Income (88000$) gives the Retained Earnings = $13000