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Hewitt Corporation’s Retained Earnings account balance was $108,000 on January 1. During January, the company recorded revenue of $600,000, expenses of $312,000, and dividends of $18,000. The company also paid a $42,000 account payable during the period. Determine the company’s Retained Earnings account balance on January 31. a. Williams, Jan.b. Financial Accounting (p. 123).c. McGraw-Hill Higher Education.d. Kindle Edition.

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Answer:

$378,000

Explanation:

The Hewitt Corporation Retained Earning as at January 31 shall be determined using the following mentioned equation.

Retained Earning at January 31=Retained Earning at January 1+Net income for the month of January-Dividend paid

In the given question:

Retained Earning at January 1=$108,000

Net income for the January=$600,000-$312,000=$288,000

Dividend paid=$18,000

Retained Earning at January 31=$108,000+$288,000-$18,000

                                                   =$378,000

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