Exercise 1-10 Blue Spruce Corp. had the following assets and liabilities on the
ID: 2331831 • Letter: E
Question
Exercise 1-10 Blue Spruce Corp. had the following assets and liabilities on the dates indicated December 31 2018 2019 2020 Total Assets Total Liabilities $478,000 $558,000 $688,000 $189,000 $239,000 $339,000 Blue Spruce began business on January 1, 2018, with an investment of $96,000 from stockholders From an analysis of the change in stockholders' equity during the year, compute the net income (or loss) for: (a) 2018, assuming Blue Spruce paid $20,000 in dividends for the year Net income (loss) for 2018 (b) 2019, assuming stockholders made an additional investment of $41,000 and Blue Spruce paid no dividends in 2019 Net income (loss) for 2019 (c) 2020, assuming stockholders made an additional investment of $16,000 and Blue Spruce paid dividends of $30,000 in 2020 Net income (loss) for 2020 Click if you would like to Show Work for this question: Modify Show WorkExplanation / Answer
Total assets - Total liabilties = Total equity
Total equity on December 31, 2018 = 478,000 - 189,000 = 289,000
Net Income = Ending total equity - Beginning total equity + Dividends
= 289,000 - 96,000 + 20,000
= 213,000
Total equity on December 31, 2019 = 558,000 - 239,000 = 319,000
Net loss = Ending total equity - Beginning total equity - Additional investment
= 319,000 - 289,000 - 41,000
= 11,000
Total equity on December 31, 2020 = 688,000 - 339,000 = 349,000
Net Income = Ending owner's equity - Beginning owner's equity - Additional investment + Drawings
= 349,000 - 319,000 - 16,000 + 30,000
= 44,000
Net income for 2018 213,000 Net loss for 2019 11,000 Net income for 2020 44,000Related Questions
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