Asked by ZAHRAH JAHANGIR on Apr 27, 2024
Verified
The ending balance of the retained earnings account appears in
A) both the statement of stockholders' equity and the income statement
B) only the statement of stockholders' equity
C) both the statement of stockholders' equity and the balance sheet
D) both the statement of stockholders' equity and the statement of cash flows
Retained Earnings Account
An equity account that represents the cumulative earnings of a company that have not been distributed to shareholders as dividends.
Statement of Stockholders' Equity
A financial statement that shows changes in the value of a company's equity over a specific period, including stocks and retained earnings.
Income Statement
A document detailing a company's income, outgoings, and financial performance for a set timeframe.
- Acquire knowledge about financial statements and their critical function in presenting a company's financial status and operations.
Verified Answer
AM
aaliyah mogajiMay 01, 2024
Final Answer :
C
Explanation :
The ending balance of the retained earnings account is a component of the stockholders' equity section of the balance sheet and is also reported in the statement of stockholders' equity. Therefore, option C is the correct choice. The retained earnings account is not reported on the income statement or statement of cash flows.
Learning Objectives
- Acquire knowledge about financial statements and their critical function in presenting a company's financial status and operations.