Prevor Corporation reports the following account balances at the end of its first year of operation: Prevor's total equity equals:

Question

Prevor Corporation reports the following account balances at the end of its first year of operation:  Prevor's total equity equals:

Quizplus · Accepted Answer

Total equity is calculated by adding common stock, retained earnings, and additional paid-in capital. 
Equity = Common Stock + Retained Earnings + Additional Paid-in capital
= $15,000 + $15,000 + $12,500
= $42,500
Therefore, the total equity of Prevot Corporation at the end of the first year of operation is $42,500.

Prevor Corporation Reports the Following Account Balances at the End