Question

Black Keys Company began the year with stockholders' equity of $185,000. During the year, the company recorded revenues of $250,000, expenses of $190,000, and paid dividends of $25,000. What was Black Keys' stockholders' equity at the end of the year?

Answer 1

Answer:

$225,000

Explanation:

The computation of the stockholders' equity at the end of the year is

= Beginning balance of stockholders' equity  + revenues earned - expenses incurred - dividend paid

= $185,000 + $250,000 - $190,000 - $25,000

= $225,000

By above equation, we can determine the stockholders' equity at the end of the year by considering all the given information