On January 1, Gucci Brothers Inc. started the year with a $690,000 balance in Retained Earnings and a $597,000 balance in common
stock. During the year, the company reported net income of $96,000, paid a dividend of $14,800, and issued more common stock for $20,000. What is total stockholders' equity at the end of the year?
The owner's equity which is an element of the balance sheet and the accounting equation is made up of retained earnings and common stock. Movements in the owner's/stockholder's equity include payment of dividend, net income for the year, stock issued etc.
Given;
Opening retained earnings = $690,000
Opening common stock = $597,000
Net income for the year = $96,000
Dividend paid = $14,800
Issued stock = $20,000
Total stockholders' equity at the end of the year = $690,000 + $597,000 + $96,000 - $14,800 + $20,000
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Marginal cost is a concept that explains the cost a company has to produce one more unit of good. This is a measure that is associated with the productivity of the inputs used in the production process. When a company increases production, marginal cost tends to decrease as inputs are better utilized. This is because the company specializes in production in order to streamline inputs and increase productivity.
