I'm stuck on a problem, and I hope someone here will be able to help.

The goal is to find the retained earnings for this year, but the only information given is the assets, liabilities, and capital stock. I'm unsure how to figure out the retained earnings from this information since the textbook only gives this formula: retained earnings = beginning retained earnings + net income - dividends

2xxx
Assets = 350,000
Liabilities = 80,000
Capital stock = 210,000

I'm grasping at straws here, but this is what I've figured out. I'm sure it's wrong! lol

Assets = Liabilites + Owners' Equity
350,000 = 80,000 + (210,000 - x) (it's not a balanced equation with just the 80k and 210k)
x = 60000

My guess is the 60,000 is the retained earnings, but I'm not sure?

Thanks in advance for any help that anyone can offer.

pieeye12

Yes,
Your answer is correct although your equation is incorrect. Owners' equity=capital
stock + retained earnings(x).
Therefore x=Assets-Liabilities-capital stock.

CaptainForest

$60,000 is correct.

In your equation, you wrote 210,000 - x, it should have been +x

2boys4me2love

Thank you both for the help!