A company reported total stockholders' equity of $340,000 on its balance sheet dated December 31,2010.During the year ended December 31,2011,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,purchased treasury stock costing $12,000,and issued additional common stock for $60,000.What is total stockholders' equity as of December 31,2011?
A)$432,000
B)$410,000
C)$444,000
D)$420,000

Question

Quizplus · Accepted Answer

December 31, 2011 stockholders' equity ($420,000) = December 31, 2010 stockholders' equity ($340,000) + 2011 net income ($40,000) - 2011 cash dividend declarations ($8,000) - treasury stock purchase ($12,000) + 2011 common stock issue ($60,000). Stock dividends do not affect total stockholders' equity.

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