FIND AND CLARIFY HOW TO FIND REVENUE The equation I have been given for finding Revenue is as follows: RE 12/31=RE 1/1+(Rev-Exp)-Dividends In this example it is solved by changing the equation from postive RE 1/1 to negative and changing Dividends Declared from negative to positive. Why is this done, when it goes against the equation listed above. So tell me WHY each step is done. Here is an example of answer I have already been given Retained earnings at the end of any financial period is computed by adding the opening balance and profits earned during the period less diviends declared/usage of retained earnings.Closing Retained Earnings=Opening Retained Earnings+Profits Earned-Dividends declared.Opening retained earnings=$8,000Closing Retained earnings=$9,000Dividend declared out of retained earnings=$3,000So, Profits earned during the period= Closing Retained earnings+Dividends declared-Opening Retained Earnings=$9,000+3,000-8,000=$4,000
FIND AND CLARIFY HOW TO FIND REVENUE
The equation I have been given for finding Revenue is as follows:
RE 12/31=RE 1/1+(Rev-Exp)-Dividends
In this example it is solved by changing the equation from postive RE 1/1 to negative and changing Dividends Declared from negative to positive. Why is this done, when it goes against the equation listed above. So tell me WHY each step is done.
Here is an example of answer I have already been given
Closing Retained Earnings=Opening Retained Earnings+Profits Earned-Dividends declared.
Opening retained earnings=$8,000
Closing Retained earnings=$9,000
Dividend declared out of retained earnings=$3,000
So, Profits earned during the period= Closing Retained earnings+Dividends declared-Opening Retained Earnings
=$9,000+3,000-8,000=$4,000
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