Marianne Company reports the following information on December 31,2011:
$$\begin{array} { l l }
\text { Cash } & \$ 70,000 \
\text { Accounts receivable } & 102,000 \
\text { Accounts payable } & 71,000 \
\text { Accrued wages payable } & 6,000 \
\text { Unearned revenue } & 2,000 \
\text { Paid-in capital } & 59,000 \
\text { Retained earnings } & ? \
\text { Inventory } & 30,000 \
\text { Prepaid rent } & 4,000 \
\text { Equipment (net) } & 12,000
\end{array}$$
What is total stockholders' equity at December 31,2011?
A) $20,000
B) $80,000
C) $139,000
D) $170,000

Question

Marianne Company reports the following information on December 31,2011:
$$\begin{array} { l l } 
\text { Cash } & \$ 70,000 \
\text { Accounts receivable } & 102,000 \
\text { Accounts payable } & 71,000 \
\text { Accrued wages payable } & 6,000 \
\text { Unearned revenue } & 2,000 \
\text { Paid-in capital } & 59,000 \
\text { Retained earnings } & ? \
\text { Inventory } & 30,000 \
\text { Prepaid rent } & 4,000 \
\text { Equipment (net) } & 12,000
\end{array}$$
What is total stockholders' equity at December 31,2011?
A) $20,000
B) $80,000
C) $139,000
D) $170,000

Quizplus · Accepted Answer

Total stockholders' equity is calculated by adding up all assets and subtracting all liabilities. Here, assets include Cash ($70,000), Accounts receivable ($102,000), Inventory ($30,000), Prepaid rent ($4,000), and Equipment (net) ($12,000), which total to $218,000. Liabilities include Accounts payable ($71,000), Accrued wages payable ($6,000), and Unearned revenue ($2,000), which total to $79,000. Subtracting liabilities from assets gives us $139,000 ($218,000 - $79,000), which includes Paid-in capital and Retained earnings. Since Paid-in capital is $59,000, the remaining amount is Retained earnings, which is part of the total stockholders' equity of $139,000.

Marianne Company Reports the Following Information on December 31,2011 What Is Total Stockholders' Equity at December 31,2011? A) $20,000

Marianne Company Reports the Following Information on December 31,2011 What Is Total Stockholders' Equity at December 31,2011?
A) $20,000