on the statement of retained earnings: a. a deficit ending balance in retained earnings is not allowed. b…

Brief Explanations:

Retained earnings represent the accumulated net income of a company after dividends are paid. A net loss is a negative net income, which reduces the amount of retained earnings. A deficit ending balance in retained earnings is possible. Dividends declared reduce retained earnings and net income increases retained earnings.

Answer:

D. a net loss decreases retained earnings.