Christian Company has the following data available:
$\begin{array} { l }
\text {Dividends declared in 201 }&\$8,000 \
\text {Retained Earnings, December 31, 2014 }&\$30,000 \
\text {Net income for the year ended December 31,2015 }&\$ 14,000\
\text {Paid-in Capital, December 31, 2014 }&\$29,000 \
\text {Paid-in Capital, December 31, 2015 }&\$ 26,000\
\end{array}$

What is the company's total stockholders' equity on December 31,2015?
A) $36,000
B) $46,000
C) $62,000
D) $101,000

Question

Christian Company has the following data available:
$\begin{array} { l  }
 \text {Dividends declared in 201 }&\$8,000 \
 \text {Retained Earnings, December 31, 2014 }&\$30,000 \
 \text {Net income for the year ended December 31,2015 }&\$ 14,000\
 \text {Paid-in Capital, December 31, 2014 }&\$29,000 \
 \text {Paid-in Capital, December 31, 2015 }&\$ 26,000\
\end{array}$

What is the company's total stockholders' equity on December 31,2015?
A) $36,000
B) $46,000
C) $62,000
D) $101,000

Quizplus · Accepted Answer

The total stockholders' equity on December 31, 2015, can be calculated by adding the retained earnings at the end of 2015 to the paid-in capital at the end of 2015. The retained earnings at the end of 2015 are the retained earnings at the end of 2014 ($30,000) plus net income for 2015 ($14,000) minus dividends declared in 2015 ($8,000), which equals $36,000. Adding this to the paid-in capital at the end of 2015 ($26,000) gives a total stockholders' equity of $62,000.

Christian Company Has the Following Data Available What Is the Company's Total Stockholders' Equity on December 31,2015