The ending balance of the retained earnings account appears in a. both the statement of stockholders' equity and the balance sheet b. only the statement of stockholders' equity c. both the statement of stockholders' equity and the statement of cash flows d. both the statement of stockholders' equity and the income statement

Question

Jazmyn Richmond

Business

22 February, 18:47

The ending balance of the retained earnings account appears in a. both the statement of stockholders' equity and the balance sheet b. only the statement of stockholders' equity c. both the statement of stockholders' equity and the statement of cash flows d. both the statement of stockholders' equity and the income statement

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Georgina · Answer 1

a. both the statement of stockholders' equity and the balance sheet

Explanation:

As we know that

The statement of stockholder equity comprises of common stock and the retained earning

The motive of preparing the statement of stockholder equity to find out the ending balance with respect to the common stock and the retained earnings

The computation is shown below:

The ending balance of retained earning = Beginning balance of retained earnings + net income - dividend paid

And, the ending balance of the common stock = Beginning balance of common stock + issued shares

Therefore, it would be presented on the statement of stockholders' equity and the balance sheet