If the beginning balance of retained earnings is $ 180 comma 000, revenue is $ 85 comma 000, expenses total $ 35 comma 000, and the company declares and pays a $ 20 comma 000 dividend, what is the ending balance of retained earnings? Let's begin by selecting the labels in the summarized statement of retained earnings and then enter the amounts to calculate the ending balance of retained earnings for the company. (Include a subtotal after the "Add" line of the statement.)

The ending balance of Retained Earnings is $210000

Explanation:

The balance in retained earning at start is $180000

The addition to retained earnings during the period will be,

Sales - Expenses = Net Profit

So,

Net profit for the period = 85000 - 35000 = $50000

Out of this Net Profit, $20000 is paid out as dividend and the remaining is retained in the business and transferred to the retained earnings account.

Thus, Closing Retained Earnings = 180000 + (50000 - 20000) = $210000

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