Question

In its most recent financial statements, Del-Castillo Inc. reported $50 million of net income and $870...

In its most recent financial statements, Del-Castillo Inc. reported $50 million of net income and $870 million of retained earnings. The previous retained earnings were $853 million. How much in dividends did the firm pay to shareholders during the year? Enter your answer in dollars. For example, an answer of $1.2 million should be entered as 1,200,000.

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Answer #2

Solution :-

Previous Year Retained Earnings = $853 millions

This Year Reported Retained Earnings = $870 Millions

Therefore Additions to Retained Earnings = $870 million - $853 million = $17 millions

Net Income Reported = $50 millions

Net Income = Dividend Paid + Additions to Retained Earnings

$50 millions = Dividend Paid + $17 millions

Therefore Dividend Paid = $50 millions - $17 millions = $33 millions

= $33,000,000

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