A firm's year-end retained earnings balance are P670,000 and P560,000 for 2014 and 2015, respectively

Finance Jun 23, 2021

A firm's year-end retained earnings balance are P670,000 and P560,000 for 2014 and 2015, respectively. The firm reported net profits after taxes of P100,000 in 2015. The firm paid dividends of ________ in 2015

Expert Solution

Computation of Dividends Paid by Firm:

Ending Retained Earnings = Beginning Retained Earnings + Net profits after taxes - Dividends

$560,000 = $670,000 + $100,000 - Dividends

Dividends = $670,000 + $100,000 - $560,000

Dividends = $210,000

So, the firm paid dividends of $210,000 in 2015.

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