The Statement of Stockholders’ Equity Absolt Corporation reported the following information in its statement of stockholders’ equity for the year ended December

a. In what ways can the statement of stockholders’ equity help investors analyze changes in the ownership claims of Absolt shareholders?

b. Absolt’s total stockholders’ equity at January 1, 2000, was $766,000 and has increased by $199,000 between January 1, 2000, and December 31, 2001. Has the 26 percent increase been primarily attributable to operating results or other factors? What has been the major source of increase?

c. Absolt sold 3,000 shares of common stock in 2000 and 2,000 shares in 2001. Did investors appear to have placed a higher or lower value on the stock in 2001 than in 2000?
How do you know?

d. If Absolt had repurchased 1,000 shares of common stock for $42 per share, what amount would be reported as total stockholders’ equity in Absolt’s balance sheet at December 31, 2001?

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Common stock ($30 par value) Beginning balance Shares issued Year Ended December 31 2001 2000 $240,000 $150,000 60,000 90,000 $300,000 $240,000 Ending balance Additional paid-in capital Beginning balance Shares issued $ 96,000 $ 96,000 34,000 Ending balance $130,000 $ 96,000 Retained earnings Beginning balance $490,000 $520,000 Net income (loss) 85,000 (30,000) Cash dividends paid (40,000) Ending balance $535,000 $490,000 Total stockholders' equity $965,000 $826,000