The 2008 balance sheet of Jim\'s Tennis Shop, Inc., showed $890,000 in the commo
ID: 2812768 • Letter: T
Question
The 2008 balance sheet of Jim's Tennis Shop, Inc., showed $890,000 in the common stock account and $6.8 million in the additional paid-in surplus account. The 2009 balance sheet showed $955,000 and $8.4 million in the same two accounts, respectively. If the company paid out $610,000 in cash dividends during 2009, What was the cash flow to stockholders for the year?
Multiple Choice
$1,055,000
$345,000
$280,000
$-1,055,000
$8,745,000
The 2008 balance sheet of Jim's Tennis Shop, Inc., showed $890,000 in the common stock account and $6.8 million in the additional paid-in surplus account. The 2009 balance sheet showed $955,000 and $8.4 million in the same two accounts, respectively. If the company paid out $610,000 in cash dividends during 2009, What was the cash flow to stockholders for the year?
Explanation / Answer
Select - Option - D ......... - 1,055,000
Cash to stock holders = Dividend paid out to stock holders - Proceeds received from issue of fresh stock
= 610,000 - ( 65,000 + 1600,000 )
= 610,000 - 1665000
= -1,055,000
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