Question

Begin by identifying the accounting equation and the formula to calculate the change in the stockholders' equity during a period. (Abbreviations used: Beg. equity = beginning equity; End. equity = ending equity.) Accounting equation: = Assets = Liabilities + Equity Stockholders' equity equation: = Beg. equity + Common stock issued + Net income or - Net loss - Dividends = End. equity For each of the following situations that occurred in June, 2018 with regard to common stock and dividends of a corporation, compute the amount of net income or net loss during June 2018. (Use a minus sign or parentheses for a net loss.) a. The company issued $5,000 of common stock and paid no dividends. Net income (loss) = $ X Х Requirement Data Table May 31, 2018 June 30, 2018 For each of the following situations that occurred in June, 2018 with regard to common stock and dividends of a corporation, compute the amount of net income or net loss during June 2018. a. The company issued $5,000 of common stock and paid no dividends. b. The company issued no common stock. It paid cash dividends of $8,000. c. The company issued $30,000 of common stock and paid cash dividends of $22,000. Total Assets $ 155,000 $ 245,000 Total Liabilities 133,000 66,000 Print Done Print Done

Answer 1

Stockholders' Equity:
	31-May-18	30-Jun-18
Total Assets	155000	245000
Less:T. Liabi.	133000	66000
SH Equity	22000	179000
Situation a)
Ending SH Equity	179000
Less: CS issued	-5000
Less: Begin SH Equity	-22000
June's Net Income	152000
Situation b)
Ending SH Equity	179000
Add: Dividend paid	8000
Less: Begin SH Equity	-22000
June's Net Income	165000
Situation c)
Ending SH Equity	179000
Less:CS issued	-30000
Add: Dividend paid	22000
Less: Begin SH Equity	-22000
June's Net Income	149000