Question

Contributed capital totals $30,000, Retained Earnings equals $65,000, Treasury Stock equals $18,000, and Common Stock equals $10,000. If the company does not have any accumulated other comprehensive income (loss), what is the total amount of stockholders' equity?

Answer 1

To find the total stockholders' equity contributed capital, retained earnings, and common stock are added together, then treasury stock is subtracted. In this scenario, the total stockholders' equity equals $87,000.

Step-by-step explanation:

The total amount of stockholders' equity is calculated by adding contributed capital, retained earnings, and common stock, then subtracting treasury stock. In this scenario, contributed capital equals $30,000, retained earnings are $65,000, and common stock is $10,000. The treasury stock, which is the company's own stock that has been reacquired, is listed as $18,000. To find the total stockholders' equity, we would perform the following calculation:

• Contributed Capital: $30,000
• Common Stock: $10,000
• Retained Earnings: $65,000
• Less: Treasury Stock: $18,000

This gives us a stockholders' equity total of: ($30,000 + $10,000 + $65,000) - $18,000 = $87,000