Relating net income to balance sheet changes Magyar T1ekom (Magyar), a Hungarian telecommunications company, reported the following balance sheet information for the years ended December 31, 2006 and 2007. Magyar applies 1FRS and reports in millions of Hungarian forints (HUF).
During 2007, Magyar declared and paid dividends of HUF72,729 million and made other adjustments, which increased retained earnings by HUF307 million.
a. Compute Magyar€™s balance in Retained Earnings for 2006.
b. Compute Magyar€™s net income for2007.

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Magyar Telekom Balance Sheet Data December 31, 2006 and 2007 2007 2006 Total Assets Total Liabilities Contributed Capital Minority Interest Retained Earnings. HUF 1,135,578 HUF 1,131,595 553,B85 129,954 66,695 538,428 128, 728 67,128 385,044