Did I make the statement of retained earnings for this proje

Did I make the statement of retained earnings for this project correct? Also, dividends declared is 1,000 but payable january 15 next year. Was correct that I added them now?

Paula\'s Plumbing, Inc. Statement of Retained Earnings 3 For The Month Ending December 31, 2017 4 Retained earnings, December 1, 2017 5 Add: Net Income $0 $8,800.00 $1,000.00 8 Retained earnings, December 31, 2017$7,800.00 7 Less: Dividends

Solution

Answer:

Yes, the Statement of Retained Earning prepared by you is Correct.

Net Income for the Current Year is added to Beginning balance of Retained Earning. And, Dividend once declared whether cash dividend or stock dividend is deducted irrespective of whether it is paid or payable, to arrive at ending balance of Retained Earning.

Retained Earning, Ending = Retained Earning, Beginning + Net Income - Dividend Declared