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4 October, 15:40

On 12/31/13, Hite Industries reported retained earnings of $525,000 on its balance sheet, and it reported that it had $135,000 of net income during the year. On its previous balance sheet, at 12/31/12, the company had reported $445,000 of retained earnings. No shares were repurchased during 2013. How much in dividends did the firm pay during 2013?

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  1. 4 October, 15:45
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    The answer is: Hite Industries paid $55,000 in dividends during 2013.

    Explanation:

    We can calculate how much Hite Industries paid in dividends during 2013 with the following formula:

    Dividends = Net income - change in Retained Earnings

    Dividends = Net income - (Retained earnings 2013 - Retained earnings 2012)

    Dividends = $135,000 - ($525,000 - $445,000)

    Dividends = $135,000 - $80,000

    Dividends = $55,000
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