Assume that Shack Company's paid-in capital at the beginning of the period was $475,000.Shack Company's total revenues and total expenses were $870,000 and $550,000, respectively.A dividend of $70,000 was declared and paid to shareholders.Shack Company's ending paid-in capital is_____.
A)$475,000
B)$825,000
C)$250,000
D)$320,000

Question

Quizplus · Accepted Answer

Paid-in capital is the amount of capital "paid in" by investors during common or preferred stock issuances, including the par value of the shares themselves. It does not change with the company's revenues, expenses, or dividends. Therefore, Shack Company's ending paid-in capital remains the same as the beginning, $475,000.

Assume That Shack Company's Paid-In Capital at the Beginning of the Period