Kagan Corporation was organized on January 2 2017. During 2017 Kagan issued 40000 shares at $24 per share purchased 6000 shares of treasury stock at $26 per share and had net income of $600000. What is the total amount of stockholders' equity at December 31 2017?

Question

Quizplus · Accepted Answer

The total amount of stockholders' equity at December 31, 2017, can be calculated as follows:- Issued shares: 40,000 shares at $24 per share = $960,000- Treasury stock purchased: 6,000 shares at $26 per share = $156,000. This amount reduces stockholders' equity.- Net income for 2017: $600,000, which increases stockholders' equity.Therefore, the total stockholders' equity at the end of 2017 is:$960,000 (from issued shares) + $600,000 (net income) - $156,000 (treasury stock) = $1,404,000.

Kagan Corporation Was Organized on January 2 2017