The owners' equity for The Buck Store was $58,900 at the beginning of the year. During the year, the company had aftertax income of $34,200, of which $2,200 was paid in dividends. Also during the year, the company repurchased $6,500 of stock from one of the shareholders. What is the value of the owners' equity at year end?

Question

Quizplus · Accepted Answer

Owners' equity at the beginning of the year = $58,900
After-tax income during the year = $34,200
Dividends paid during the year = $2,200
Repurchase of stock during the year = $6,500
The increase in owners' equity during the year can be calculated as:
$34,200 - $2,200 - $6,500 = $25,500
Therefore, the owners' equity at the end of the year is:
$58,900 + $25,500 = $84,400
Hence, the correct answer is D.

The Owners' Equity for the Buck Store Was $58,900 at the Beginning