The effect on total stockholders' equity decreases by $82858.
What is stockholders' equity?
- Stockholders' equity refers to the assets remaining in a business once all liabilities have been settled.
- This figure is measured by subtracting total liabilities from total sum of the assets; alternatively, it can be measured by taking the total of share capital and retained earnings, less treasury stock.
What will be the effect on total stockholders' equity?
Given:
Shares = 4,874
$8 par common stock for $17 per share
The effect on total stockholders' equity
= (4874)*($17)
= $82858
∴ The effect on total stockholders' equity decreases by $82858.
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