Bleu Berri Farms had equity of $58,900 at the beginning of the year. During the year, the company earned net income of $8,200 and paid $2,500 in dividends. Also during the year, the company repurchased $3,500 of stock from one of its shareholders. What is the value of the owners' equity at year end?

Question

Isai Gibson

Business

15 April, 02:34

Bleu Berri Farms had equity of $58,900 at the beginning of the year. During the year, the company earned net income of $8,200 and paid $2,500 in dividends. Also during the year, the company repurchased $3,500 of stock from one of its shareholders. What is the value of the owners' equity at year end?

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Answers (1)

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Ricardo Meadows · Answer 1

Owner's equity at year end would be $61,100

Explanation:

$58,900 (Beginning equity) + $8,200 (Net income increases owner's equity) - $2,500 (This is paid out of retained earnings/owner's equity) - $3,500 (A repurchase of stocks reduced owner's equity as cash would have been given to the shareholder for their equity) = $61,100