Question

During 2022, half of the treasury stock was resold for $240,000; net income was $600,000; cash dividends declared were $1,500,000; and stock dividends declared were $500,000. The 2022 sale of half of the treasury stock would:______________

Answer 1

Answer:

Total Stockholder's equity = $6,760,000

Explanation:

Note:

Missing content;

Cash dividends = $20,000

Treasury stock = $600,000

Share repurchase = $20,000

Common stock = $4,000,000

Retained earnings = $3,000,000

Computation:

Common stock = $4,000,000+$400,000

Common stock = $4,400,000

Retained earnings = $3,000,000+$600,000-$500,000-$400,000-$40,000 Retained earnings = 2,660,000

Total Stockholder's equity = Common stock + Retained earnings - Treasury Stock

Total Stockholder's equity = $6,760,000