Dividend

Assuming that the dividend had not been paid before the end of the year (normally it will not have been paid) then the amount will be attached to the financial statements as one of the notes (along with the standard notes about non-current assets; events after the reporting date; etc.)

Hi Mr Moffat. I'd really appreciate your kind help with this question : ABC Co has the following share capital: 100 000 6% irredeemable pref.shares 200 000 50c ord.shares Retained earnings @ the beginning of the yr $125 000. During the yr ended 31Dec x7 it made the ff profit: Profit before tax $60 000 Income tax exp $10 000 Profit for the yr $50 000 Ordinary dividends paid and declared during the yr were as follows: Interim dividend paid 5c per share. Final dividend declared on 20 Jan x8 10c per share. Required: Show the movement in retained earnings for ABC Co for the year ended 31 Dec x7. My attempt was: 50 000-[6%*100 000]-200 000*.05=$34000. Kindly help me see where I might be wrong. Many thanks in advance. Regards

What you have done is correct, except you should start with the retained earnings at the start of the year (125,000), then show the movements (yours are correct) and end up with the retained earnings at the end of the year. However I am a bit puzzled why you are needing to ask, because surely there is an answer in the same book in which you found the question? (If there isn't then you really should be using a different book :-) )