Question

Sunland Company began the year 2022 with $121000 in its Common Stock account and a debit balance in Retained Earnings of $51800. During the year, the company earned net income of $25900, and declared and paid $8600 of dividends. In addition, the company sold additional common stock amounting to $31700. Based on this information, what should the transaction analysis show for total stockholders' equity at the end of 2022

Answer 1

Answer:

Total stockholders' equity at the end of 2022 is $118,200

Explanation:

The stockholder's equity is the sum of the common stock balance and the retained earnings balance. Movement in retained earnings is due to net income and dividend paid. Both accounts are usually credit balances.

Total stockholders' equity = $121,000 - $51,800 + $25900 - $8600 + $31700

= $118,200