At the beginning of the year, Vendors, Inc., had owners' equity of $51,800. During the year, net income was $7,900 and the company paid dividends of $5,200. The company also repurchased $9,800 in equity. What was the cash flow to stockholders for the year

Question

Business

Brisa Everett

28 March, 06:20

At the beginning of the year, Vendors, Inc., had owners' equity of $51,800. During the year, net income was $7,900 and the company paid dividends of $5,200. The company also repurchased $9,800 in equity. What was the cash flow to stockholders for the year

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Answers (1)

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Valentino Leonard · Answer 1

The correct answer is $15,000.

Explanation:

According to the scenario, the given data are as follows:

Owner's equity = $51,800

Net income = $7,900

Dividends paid = $5,200

Equity repurchased = $9,800

So, we can calculate the cash flow to stockholders by using the following formula:

Cash Flow = Equity Repurchase + Dividends Paid - New issue of shares

= $9,800 + $5,200 - $0

= $15,000

Hence, the cash flow to stockholders for the year was $15,000.