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Question
The income statement for Hudson Company reported net income of $345,000 for the year ended December 31 before considering the following:
- During the year, the company purchased trading securities.
- At year-end, the fair value of the investment portfolio was $23,000 less than cost.
- The balance of Retained Earnings was $823,000 on January 1.
- Hudson Company paid $43,000 in cash dividends during the year.
Compute the balance of Retained Earnings on December 31.
Answer
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