Peason began 20xx with 30,000 $1 common shares issued and outstanding.paid in captial in excess of par was $25,000 and retained earnings were $175,000 net income
for 20xx was $22,000.
To find the ending value of shareholders' equity for the year 20xx, you need to consider the following components:
1. Common Shares Issued and Outstanding: Peason began 20xx with 30,000 $1 common shares issued and outstanding. This means that there were 30,000 shares of common stock held by shareholders.
2. Paid-in Capital in Excess of Par: Paid-in capital in excess of par is the amount received by the company from shareholders in excess of the par value of the shares. In this case, the paid-in capital in excess of par is $25,000.
3. Retained Earnings: Retained earnings represent the accumulated profits of a company that have not been distributed to shareholders as dividends. For the beginning of 20xx, the retained earnings were $175,000.
4. Net Income: Net income is the profit earned by the company during the year. For 20xx, the net income was $22,000.
To calculate the ending value of shareholders' equity, you need to sum up the common shares, paid-in capital in excess of par, retained earnings, and net income:
Ending Shareholders' Equity = Common Shares + Paid-in Capital in Excess of Par + Retained Earnings + Net Income
In this case:
Ending Shareholders' Equity = 30,000 + $25,000 + $175,000 + $22,000
Ending Shareholders' Equity = $252,000
So, the ending value of shareholders' equity for the year 20xx is $252,000.