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Yellow Enterprises reported the following ($ in thousands) as of December 31, 2021. All accounts have...

Yellow Enterprises reported the following ($ in thousands) as of December 31, 2021. All accounts have normal balances.

Deficit (debit balance in retained earnings) $ 3,000
Common stock 2,000
Paid-in capital—share repurchase 1,000
Treasury stock (at cost) 400
Paid-in capital—excess of par 30,000


During 2022 ($ in thousands), net income was $9,000; 25% of the treasury stock was resold for $450; cash dividends declared were $600; cash dividends paid were $500.

What ($ in thousands) was shareholders' equity as of December 31, 2022?

Multiple Choice

  • $38,100.

  • $37,450.

  • $38,450.

  • $38,350.

Solutions

Expert Solution

Answer: $38,450

Explanation

Shareholders’ equity as of December 31, 2021
$
Common stock        2,000.00
Paid-in capital–excess of par      30,000.00
Paid-in capital—share repurchase        1,000.00
Retained earnings      (3,000.00)
Treasury stock         (400.00)
Total shareholders’ equity on December 31, 2021      29,600.00
Shareholders’ equity as of December 31, 2022
$
Shareholders’ equity on December 31, 2021      29,600.00
Net income        9,000.00
Sale of treasury stock          450.00
Dividends declared         (600.00)
Total shareholders’ equity on December 31, 2022 38,450.00

ekkarill92 answered 8 months ago
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