The Records of a Corporation for Year 3 Reflected the Following

Essay

The records of a corporation for year 3 reflected the following correct pre-tax amounts: cash dividends declared and paid, $16,000; retained earnings, January 1, year 3, $120,000, correction of accounting error, $10,000 debit; income before income taxes and before extraordinary item, $60,000. The average income tax rate of 40 percent applies to all items except the dividends.
The December 31, year 3 (ending) balance of retained earnings was $________________.