A. The major emphasis in auditing the retained earnings account should be on the recorded changes that have taken place during the year, such as net earnings for the year, distributions, prior period adjustments, extraordinary items charged or credited directly to retained earnings, or setting up or elimination of appropriations. Except for prior period adjustments, the other items should be verified during other parts of the engagement. This is especially true of the dividends declared. Therefore, the audit of retained earnings primarily consists of an analysis of the changes in retained earnings and the verification of the authorization and accuracy of the underlying transactions. B. The major emphasis in auditing the retained earnings account should be on the recorded changes that have taken place during the year, such as interest income, dividends declared, prior period adjustments, extraordinary items charged or credited directly to retained earnings, or setting up or elimination of appropriations. Except for extraordinary items, the other items should be verified during other parts of the engagement. This is especially true of the dividends declared. Therefore, the audit of retained earnings primarily consists of an analysis of the changes in retained earnings and the verification of the authorization and accuracy of the underlying transactions. C. The major emphasis in auditing the retained earnings account should be on the recorded changes that have taken place during the year, such as net earnings for the year, dividends declared, prior period adjustments, extraordinary items charged or credited directly to retained earnings, or setting up or elimination of appropriations. Except for dividends declared, the other items should be verified during other parts of the engagement. This is especially true of the net earnings for the year. Therefore, the audit of retained earnings primarily consists of an analysis of the changes in retained earnings and the verification of the authorization and accuracy of the underlying transactions. D. The major emphasis in auditing the retained earnings account should be on the recorded changes that have taken place during the year, such as net earnings for the year, dividends declared, interest revenue, investment revenue, extraordinary items charged or credited directly to retained earnings, or setting up or elimination of appropriations. Except for dividends declared, the other items should be verified during other parts of the engagement. This is especially true of the net earnings for the year. Therefore, the audit of retained earnings primarily consists of an analysis of the changes in retained earnings and the verification of the authorization and accuracy of the underlying transactions