Question

Abbreviated financial statements for Archimedes Levers are shown in the table below. Assume sales and expenses increase by 10% in 2017 and all assets and liabilities increase correspondingly. Also assume no new equity is issued and none is repurchased.

Income Statement
Sales	$	4,000
Costs, including interest		3,500
Net income	$	500

Balance Sheet, Year-End
	2016			2015				2016			2015
Net assets	$	3,200		$	2,700		Debt	$	1,200		$	1,033
							Equity		2,000			1,667
Total	$	3,200		$	2,700		Total	$	3,200		$	2,700

a. What is the value of the addition to retained earnings for 2017?

Addition to retained earnings            $

b. What is the residual dividend for 2017?

Residual dividend            $

Answer 1