A company reported total stockholders' equity of $340,000 on its balance sheet dated December 31,2018.During the year ended December 31,2019,the company reported net income of $40,000,declared and paid a cash dividend of $8,000,declared and distributed a 10% stock dividend with a $10,000 total market value,issued additional common stock for $60,000,and paid $12,000 to purchase treasury stock.What is total stockholders' equity as of December 31,2019?
A)$432,000.
B)$410,000.
C)$444,000.
D)$420,000.

Question

Quizplus · Accepted Answer

The total stockholders' equity as of December 31, 2019, can be calculated as follows:Starting equity: $340,000+ Net income: $40,000- Cash dividends: -$8,000+ Issued common stock: $60,000- Purchase of treasury stock: -$12,000(Note: The 10% stock dividend does not affect the total stockholders' equity directly as it redistributes equity within the shareholders' equity section without changing the total amount.)Therefore, the total stockholders' equity is $340,000 + $40,000 - $8,000 + $60,000 - $12,000 = $420,000.

A Company Reported Total Stockholders' Equity of $340,000 on Its