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AB Ltd.'s retained earnings increased by $184 during the year. Also during the year dividends of $2,370 were declared and paid to shareholders. AB's net income for the year must have been: $

AB Ltd.'s retained earnings increased by $184 during the year. Also during the year dividends of $2,370 were declared and paid to shareholders. AB's net income for the year must have been: $

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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AB Ltd.'s retained earnings increased by $184 during the year. Also during the year dividends of $2,370 were declared and paid to shareholders. AB's net income for the year must have been: $
Transcribed Image Text:AB Ltd.'s retained earnings increased by $184 during the year. Also during the year dividends of $2,370 were declared and paid to shareholders. AB's net income for the year must have been: $
Expert Solution
Step 1: Introduction:

Retained earnings balance includes net income and the dividends paid out of the retained earnings.

Retained earnings are recorded in the stockholders' section of the Balance Sheet.

Net income is the difference between total sales and total expenses of the business.

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