The right side of the balance sheet shows the firm's liabilities and stockholders' equity.Which of the following best describes shareholders' equity?O Equity is the difference between the company's assets and liabilities.O Equity is the initial claim on value of the assets before the firm pays off its liabilities.NOW Inc. released its annual results and financial statements. Grace is reading the summary in the business pages of today's paper. In its annualreport this year, NOW Inc. reported a net income of $116 million. Last year, the company reported a retained earnings balance of $595 million,whereas this year it increased to $700 million. How much was paid out in dividends this year?O $221 millionO $6 millionO $11 millionO $60 million

Answered: The right side

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The right side of the balance sheet shows the firm's liabilities and stockholders' equity.
Which of the following best describes shareholders' equity?
O Equity is the difference between the company's assets and liabilities.
O Equity is the initial claim on value of the assets before the firm pays off its liabilities.
NOW Inc. released its annual results and financial statements. Grace is reading the summary in the business pages of today's paper. In its annual
report this year, NOW Inc. reported a net income of $116 million. Last year, the company reported a retained earnings balance of $595 million,
whereas this year it increased to $700 million. How much was paid out in dividends this year?
O $221 million
O $6 million
O $11 million
O $60 million

Expert Solution

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Equity holder refers to the individuals that provide liquidity to the company and in return, the company offers them ownership rights. They receive profits in the form of dividends from the company

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