How does "Bonus Payable" fit in to the calculation of retained earnings? [Archive]

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caculovic

Dec 10, 2009, 07:28 PM

What is the ending retained earnings balance in the following situation?

Beginning Retained earnings balance 63000
Net income 20000
Dividends 4000
Bonus payable 5000

ROLCAM

Dec 10, 2009, 09:28 PM

BeginRetain earnings balance 63000
net income 20000
-------------------------------------
sub total = 83,000
LESS

dividends 4000
bonus payable 5000
------------------------
New total 74,000 Close retain earnings.