Appropriations to retained earnings are A. recorded as an contra-asset C. recorded as a contra-liability. D. a contra-stockholders’ equity.

Question

Appropriations to retained earnings are
A. recorded as an contra-asset.
B. disclosed in the notes to the financial statements.
C. recorded as a contra-liability.
D. a contra-stockholders’ equity.

Answer 1

The correct answer is B.

. Appropriations are also called reserves or restrictions, and they are reported in notes to the financial statements.