Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

12. Stockholders' Equity

Retained Earnings

Financial Accounting

12. Stockholders' Equity

Retained Earnings

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Multiple Choice

Which of the following would be included on a statement of retained earnings?

Dividends declared during the period

Net income for the period

Total assets at year-end

Cash flows from operating activities

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Verified step by step guidance

Understand the purpose of the statement of retained earnings: It is a financial statement that shows the changes in retained earnings over a specific period. Retained earnings are the portion of net income that is not distributed as dividends but retained by the company for reinvestment or to pay off debt.

Identify the key components of the statement of retained earnings: The statement typically includes the beginning retained earnings balance, net income (or net loss) for the period, dividends declared, and the ending retained earnings balance.

Analyze the options provided: Determine which items are relevant to the statement of retained earnings. For example, 'Net income for the period' directly affects retained earnings as it increases the balance, while 'Dividends declared during the period' reduces retained earnings.

Eliminate irrelevant options: 'Total assets at year-end' and 'Cash flows from operating activities' are not part of the statement of retained earnings. These belong to the balance sheet and statement of cash flows, respectively.

Conclude that the correct answer is 'Net income for the period,' as it is a key component of the statement of retained earnings and directly impacts the calculation of the ending retained earnings balance.