Question

do the self-graded study question prob stmt of stockholder's equitydownload prob stmt of stockholder's equity from the t-account, select one date and write out an entire journal entry. describe the purpose of that entry. compare your completed statement of stockholder's equity as of 12/31/20y9 vs. the beginning of year balance at 1/1/20y9. what information can be gleaned over based on the limited information provided? what can you tell about the financial health of the company?

Answer 1

Given the problem statement,Stockholder's equity is a measure of the residual interest in a business, or the equity held by the owners of a business after subtracting liabilities from assets. In essence, stockholder's equity represents the amount of a company's net worth that is attributable to shareholders. It is calculated by subtracting total liabilities from total assets. Here is the journal entry for stockholder's equity:Date: December 31, 2020Accounts Debit Credit Retained Earnings XXXX Capital Stock XXXX To record stockholder's equityThe purpose of this entry is to record the owner's equity in the business. This is the amount of equity that the owner has invested in the business, and it is typically recorded as a credit to the capital stock account. The retained earnings account is also debited, which represents the earnings that the company has retained over time. By comparing the statement of stockholder's equity as of December 31, 2020, with the beginning-of-year balance at January 1, 2019, you can get an idea of how the company has changed over time. Based on the limited information provided, it is difficult to make any definitive conclusions about the financial health of the company. However, you can get a general sense of how the company is doing by looking at the change in stockholder's equity over time. If stockholder's equity has grown significantly, this is generally a good sign that the company is doing well. If it has declined, this may indicate that the company is struggling.