Mags & Wheels, Inc reported Retained Earnings of $20, 000 at year-end 2007. The accomping income statement reported $2000 in revenues for 2007 and $1000 in expenses. The biginning 2007 balance of retained Earnings must have been what?

I guest $10000. Please help?

I think 10000$ is wrong , but I just can't give u the answer because the rule of this forum.However , I can give the idea how to get the amount of beginning retained earning.

INCOME STATEMENT
Service revenue...
Less expense (... )
=Net income...

Then ,
STATEMENT OF RETAINED EARNING
Beginning of Retained Earning...
Plus Net Income...
Less Dividends (... )
=Ending Retained Earning...

here the link ,http://www.principlesofaccounting.com/chapter%201.htm

I came up with 30,000 with the outine sample you gave me is this correct?

I don't know how you came up with 30 .000$.They gave the ending retained earning of 20000$, and want you to solve for beginning retained earning..

INCOME STATEMENT
Revenue:... 2000
Expense:... (1000)
=Net Income:... 1000

Now the net income will go to the statement of retained earning

STATEMENT OF RETAINED EARNING
Beginning of Retained Earning..?
Plus Net Income... 1000
Less Dividends... (... ) in this case we have no dividend
Ending Retained Earning... 20.000

Now solve for "???" do a little math here (?? + 1000-0=20000)=>?? =20.000-1000=19000$

I don't know how you came up with 30 .000$.They gave the ending retained earning of 20000$, and want you to solve for beginning retained earning..

INCOME STATEMENT
Revenue:... 20000
Expense:... (10000)
=Net Income:... 10000

Now the net income will go to the statement of retained earning

STATEMENT OF RETAINED EARNING
Beginning of Retained Earning... 20000
Plus Net Income... 10000
Less Dividends... (... ) in this case we have no dividend
Ending Retained Earning... 30000

Now solve for "???" do a little math here (10000? + 20000=30000)
is this correct?

Yes Mary,it is correct.
The data in question you posted,you reported Revenue:2000$ and Expense : 1000$. Now this one, you have changed the amount of revenue and expense up to 10 times.That s why I did not know how you cam up with 30.000$.. Anyway hope it helps