Question

Calculate Total Equity at the end of the year for each of the following companies. Part A) GUT Company has total equity at the beginning of the year of $5,100. There are no stock issuances during the year. The company has net income of $7,400 and pays out dividends of $1,000. What is the total equity at the end of the year? $ Part B) Eagle Inc. has total equity at the beginning of the year of $6,000. It issues $3,300 of common stock during the year. The company has net income of $6,300 and pays out dividends of $2,200 What is the total equity at the end of the year? s Part C) BHM Corporation has total assets of $13,300 and total liabilities of $4,100 at the beginning of the year. It issues $3,700 of common stock during the year.. The company has net income of $7,000 and pays out dividends of $1,400. What is the total equity at the end of the year?$

Answer 1

Part A) :

Total equity at the beginning of the year	$5,100
(+) Net income	$7,400
(-) Dividends	( $1,000 )
Total equity at the end of the year	$11,500

Part B) :

Total equity at the beginning of the year	$6,000
(+) Common stock issued	$3,300
(+) Net income	$6,300
(-) Dividends	( $2,200 )
Total equity at the end of the year	$13,400

Part C) :

Total equity at the beginning of the year = Beginning total assets - Beginning total liabilities = $13,300 - $4,100 = $9,200

Total equity at the beginning of the year	$9,200
(+) Common stock issued	$3,700
(+) Net income	$7,000
(-) Dividends	( $1,400 )
Total equity at the end of the year	$18,500