Tuscan Inc. had a retained earnings balance of $66,000 at December 31, 2018. During the year, Tuscan had the following selected transactions. • Reported net income of $106,000.
• Revised an estimate of a machine's salvage value. Depreciation increased by $1,600 per year.
• An error was discovered. Three years ago, a purchase of a building was incorrectly expensed. The effect is understated retained earnings of $18,000 (net of tax benefit).
• Paid cash dividends of $39,000.
Calculate the retained earnings balance at December 31, 2019. (Amounts to be deducted should be indicated with a minus sign.)
TUSCAN INC.
Statement of Retained Earnings
For Year Ended December 31, 2019
Prior period adjustment

$159,000

Explanation:

The computation of the ending retained earnings balance is shown below:

                                                      Tuscan Inc

                                  Statement of Retained Earnings

                                 For Year Ended December 31, 2019

Retained Earnings, December 31, 2018             $74,000

Building cost incorrectly expensed (net of tax) $18,000

Adjusted retained earnings                                 $92,000

Add: Net Income                                                  $106,000

Less: Dividends                                                   -$39,000

Retained Earnings as on December 31, 2019    $159,000

answer; /// i do believe that the correct answer is ; ///claude garamond;

answer; the above statement/question is ( true);