Wiley Hill opened Hill's Repairs on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books: • Wiley, the sole stockholder, invested $25,000 cash in the business in exchange
For common stock.
• Wiley contributed $100,000 of equipment to the business in exchange for common stock.
• The company paid $2,000 cash to rent office space for the month of March.
• The company received $16,000 cash for repair services provided during March.
• The company paid $6,200 for salaries for the month of March.
• The company provided $3,000 of services to customers on account.
• The company paid cash of $500 for utilities for the month of March.
• The company received $3,100 cash in advance from a customer for repair services
To be provided in April.
• The company paid Wiley $5,000 cash as a dividend.
Based on this information, total stockholder's equity reported on the balance sheet at the end of March would be:
A) $133,400.
B) $130,300.
C) $125,300.
D) $8,400.
E) $13,500.

Question

Quizplus · Accepted Answer

Total stockholder's equity can be calculated by adding common stock, retained earnings, and any additional paid-in capital.

Common Stock = $25,000 (invested by the stockholder)
Additional Paid-in Capital = $100,000 (equipment contributed by the stockholder)
Retained Earnings = $16,000 (revenue earned during March) - $6,200 (salaries paid) - $2,000 (rent paid) - $500 (utilities paid) + $3,000 (services provided on account) = $10,300

Therefore, Total stockholder's equity = Common Stock + Additional Paid-in Capital + Retained Earnings
= $25,000 + $100,000 + $10,300
= $130,300

The correct answer is B.

Wiley Hill Opened Hill's Repairs on March 1 of the Current