A company's retained earnings balance increased $50,000 last year; therefore, net income last year must have been $50,00

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answerhappygod
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A company's retained earnings balance increased $50,000 last year; therefore, net income last year must have been $50,00

Post by answerhappygod »

A company's retained earnings balance increased $50,000 last year; therefore, net income last
year must have been $50,000.

Answer: FALSE
Explanation: Retained earnings is increased by net income and decreased by dividends.
Therefore, we would need to know the dividend amount was zero in this situation to make the
above statement true.
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