the balance sheet reports the retained earnings balance at the end of a fiscal year. what is the source of…
the balance sheet reports the retained earnings balance at the end of a fiscal year. what is the source of this ending balance of retained earnings?\na. unadjusted trial balance\nb. statement of retained earnings\nc. trial balance worksheet\nd. adjusted trial balance
Answer
Brief Explanations:
The statement of retained earnings calculates the ending retained earnings balance by considering the beginning balance, net income (or loss), and dividends. This calculated ending balance is then reported on the balance sheet. The unadjusted trial balance, trial balance worksheet, and adjusted trial balance do not directly provide the ending retained earnings balance in the way required for the balance sheet. The key here is understanding the flow of financial statements where the statement of retained earnings feeds into the balance sheet for the retained earnings line - item.
Answer:
B. Statement of Retained Earnings