Final answer:
The Stockholders' Equity at December 31, 2015 is calculated using the accounting equation considering the assets, liabilities net income the sale of common stock, and dividends. It amounts to $3621.
Step-by-step explanation:
Determining the Stockholders' Equity
To calculate the Stockholders' Equity at December 31, 2015, we need to make use of the accounting equation which states that Assets = Liabilities + Stockholders' Equity. Given the information:
- Assets, January 1: $5662
- Dividends: $1033
- Sales of Common Stock during 2015: $966
- Net Income: $1348
- Liabilities, January 1: $3322
We can assume that the assets have not changed by the end of the year (since no new assets or changes in assets have been mentioned), and thus the assets at the end of the year remain at $5662. To find the Stockholders' Equity at the end of the year, we use the formula:
Stockholders' Equity = Assets - Liabilities
We know the net income will be added to the equity, and dividends will be subtracted. The sales of common stock will also increase the equity.
As a result, the Stockholders' Equity will be calculated as:
$5662 (Assets) - $3322 (Liabilities) = $2340 + $966 (Sales of Common Stock) + $1348 (Net Income) - $1033 (Dividends)
this gives a total Stockholders' Equity of:
$3621 at December 31, 2015.
Therefore, the Stockholders' Equity at December 31, 2015, is $3621.