Would someone please help with this! Please and Thank you! For each of the follo
ID: 2551406 • Letter: W
Question
Would someone please help with this! Please and Thank you!
For each of the following situations that occurred in June, 2018 with regard to common stock and dividends of a corporation, compute the amount of net income or net loss during June 2018.
The company issued $10,000 of common stock and paid no dividends.
The company issued no common stock. It paid cash dividends of $3,000.
The company issued $12,500 of common stock and paid cash dividends of $30,000.
May 31, 2018 June 30, 2018 Total Assets $ 122,000 $ 287,000 Total Liabilities 66,000 144,000Explanation / Answer
Ending Equity = 287000 – 144000 = 143000
Beginning Equity = 122000 – 66000 = 56000
(a) The company issued $10,000 of common stock and paid no dividends.
Net Income = Ending equity-Beginning equity-Common stock issued+Dividends
= 143000 – 56000 – 10000
= $ 77,000
(b)The company issued no common stock. It paid cash dividends of $3,000.
Net Income = Ending equity-Beginning equity-Common stock issued+Dividends
= 143000 – 56000 – 0 + 3000
= $ 90,000
©The company issued $12,500 of common stock and paid cash dividends of $30,000.
Net Income = Ending equity-Beginning equity-Common stock issued+Dividends
= 143000 – 56000 – 12500 +30000
= $ 104500
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