Wiley Hill opened Hill's Repairs on March 1 of the current year.During March,the following transactions occurred:
1.Wiley invested $25,000 cash in the business in exchange for common stock.
2.Wiley contributed $100,000 of equipment to the business in exchange for common stock.
3.The company paid $2,000 cash to rent office space for the month of March.
4.The company received $16,000 cash for repair services provided during March.
5.The company paid $6,200 for salaries for the month of March.
6.The company provided $3,000 of services to customers on account.
7.The company paid cash of $500 for utilities for the month of March.
8.The company received $3,100 cash in advance from a customer for repair services to be provided in April.
9.The company paid $5,000 in cash dividends.
Based on this information,the total amount of stockholders' equity reported on the balance sheet at the end of March would be:
A)$133,400.
B)$130,300.
C)$125,300.
D)$8,400.
E)$13,500.

Question

Wiley Hill opened Hill's Repairs on March 1 of the current year.During March,the following transactions occurred: 
1.Wiley invested $25,000 cash in the business in exchange for common stock.
2.Wiley contributed $100,000 of equipment to the business in exchange for common stock.
3.The company paid $2,000 cash to rent office space for the month of March.
4.The company received $16,000 cash for repair services provided during March.
5.The company paid $6,200 for salaries for the month of March.
6.The company provided $3,000 of services to customers on account.
7.The company paid cash of $500 for utilities for the month of March.
8.The company received $3,100 cash in advance from a customer for repair services to be provided in April.
9.The company paid $5,000 in cash dividends.
Based on this information,the total amount of stockholders' equity reported on the balance sheet at the end of March would be:
A)$133,400.
B)$130,300.
C)$125,300.
D)$8,400.
E)$13,500.

Quizplus · Accepted Answer

The total stockholders' equity at the end of March can be calculated as follows:

Common stock: $25,000 (from transaction 1)
Additional paid-in capital: $100,000 (from transaction 2)
Retained earnings: 
   Beginning balance: $0
   Add: Revenue from repair services provided during March: $16,000 (from transaction 4)
   Less: Rent expense for March: $2,000 (from transaction 3)
   Less: Salaries expense for March: $6,200 (from transaction 5)
   Less: Dividends paid: $5,000 (from transaction 9)
   Add: Accounts receivable from services provided to customers on account: $3,000 (from transaction 6)
   Less: Advance cash received from a customer for repair services to be provided in April: $3,100 (from transaction 8)
   Less: Utilities expense for March: $500 (from transaction 7)
   Retained earnings balance at the end of March: $2,100

Total stockholders' equity = Common stock + Additional paid-in capital + Retained earnings
= $25,000 + $100,000 + $2,100
= $127,100

Therefore, the correct answer is B) $130,300, which is not one of the options.

Wiley Hill Opened Hill's Repairs on March 1 of the Current