Creston Enterprises has common stock with a par value of $5.During the current year,it declared and paid dividends of $20,000.It sold at $20 per share an additional 2,000 shares of stock that had not been previously issued.In addition,it had net income of $100,000 for the year.What is the amount of change to its stockholders' equity for the year?
A)$140,000
B)$90,000
C)$110,000
D)$120,000

Question

Quizplus · Accepted Answer

Stockholders' equity increases by $120,000 [or proceeds from stock issuance of $40,000 (or 2,000 shares × $20 per share)+ net income of $100,000 − dividends of $20,000].

Creston Enterprises Has Common Stock with a Par Value of $5.During