During January 2014, its first month of operation, Osborn Enterprises earned net income of $1,700 and paid dividends to the owners of $500. At January 31, the balance in Retained Earnings will be a. $0. b. $1,700 credit. c. $1,200 credit. d. $500 debit.

Question:

During January 2014, its first month of operation, Osborn Enterprises earned net income of $1,700 and paid dividends to the owners of $500. At January 31, the balance in Retained Earnings will be:

a. $0

b. $1,700 credit

c. $1,200 credit

d. $500 debit

Retained Earnings:

Retained earnings represent the accumulated net income that is reported in the stockholders' equity. Retained earnings are used as a source of internal financing so that external financing needs are reduced. Retained earnings are used to pay dividends.

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During January 2014, its first month of operation, Osborn Enterprises earned net income of $1,700...

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Retained Earnings:

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