1. At the beginning of the year, Fedele Corporation\'s assets were $150,000 and
ID: 2436759 • Letter: 1
Question
1. At the beginning of the year, Fedele Corporation's assets were $150,000 and its stockholders' equity was $100,000. During the year, assets increased $15,000 and liabilities decreased $30,000. What was the stockholders equity at the end of the year? 2. Indicate by letter whether each item below would appear on the income statement (IS), balance sheet (BS), or statement of retained earnings (RE) a. Common Stock b. Dividends Payable c. Interest Expense d. Commissions Earned e. Buildings f. Accounts Payable g. Utilities Expense h. Beginning Retained Earnings i. Accounts Receivable j. Wages PayableExplanation / Answer
Answer 1. As per Accounting Equation: Assets = Liabilities + Stockholders' Equity At the Beginning of Year: $150,000 (Assets) = Liabilities + $100,000 (Stockholders' Equity) Liabilities = $150,000 - $100,000 Liabilities = $50,000 End of the Year: Assets = $150,000 + $15,000 = $165,000 Liabilities = $100,000 - $30,000 = $70,000 Stockholders' Equity = $165,000 (Assets) - $70,000 (Liabilities) Stockholders' Equity = $95,000 Answer 2. a. Common Stock Balance Sheet b. Dividends Payable Balance Sheet c. Interest Expense Income Statement d. Commissions Earned Income Statement e. Buildings Balance Sheet f. Accounts Payable Balance Sheet g. Utilities Expense Income Statement h. Beginning Retained Earnings Statement of Retained Earnings i. Accounts Receivable Balance Sheet j. Wages Payable Balance Sheet
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