The ABC company had an interest expense of $4,406, and a tax rate of 37%. The company paid$2,399 as dividends. If the retained earnings is 2006 were $51,337, what are the retained earnings in 2007?

The retained earnings in 2007 can be calculated by subtracting total expenses from total revenue, then adding any additional income such as dividends, and finally subtracting taxes. To begin, the net income is determined by taking the sales of $93,054 and subtracting all related expenses which comes to a total of $52,063.

Next, any extra sources of income must be included which in this case was $2,399 for dividends. This brings the sum up to $54,462. Finally taxes must be taken into account at 37% resulting in a deduction of $20,113 leaving a final figure of $34,349 for retained earnings.

Overall, the retained earnings for ABC in 2007 would amount to $34,349 ($51 337 + 2 399 – 20 113) once all relevant factors are considered. This number reflects both the funds generated through operations as well as any investments that may have been made over time while also accounting for any necessary deductions such as taxes or dividend payments.