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24 January, 07:29

What is the total stockholders' equity based on the following account balances?

Common Stock $375,000

Paid-In Capital in Excess of Par 90,000

Retained Earnings 190,000

Treasury Stock 15,000

A $655,000

B $565,000

C $640,000

D $670,000

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  1. 24 January, 07:39
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    The total stockholders' equity amounts to $640,000

    Explanation:

    The total stockholders' equity is computed as:

    Total stockholders' equity = Common Stock + Paid-In Capital in Excess of Par + Retained Earnings - Treasury Stock

    where

    Common Stock is $375,000

    Paid-In Capital in Excess of Par is 90,000

    Retained Earnings is 190,000

    Treasury Stock is 15,000

    Putting the values in the above:

    = $375,000 + $90,000 + $190,000 - $15,000

    = $655,000 - $15,000

    = $640,000
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