If equity at the beginning of the period is $177,000, profit for the period is $87,000 and dividends of $25,000 were paid during the period, equity at the end of the period is:
Question
If equity at the beginning of the period is 87,000 and dividends of $25,000 were paid during the period, equity at the end of the period is:
Solution
To calculate the equity at the end of the period, you need to follow these steps:
- Start with the equity at the beginning of the period, which is $177,000.
- Add the profit for the period to the beginning equity. The profit is 177,000 + 264,000.
- Subtract the dividends paid during the period from the result in step 2. The dividends are 264,000 - 239,000.
Therefore, the equity at the end of the period is $239,000.
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