Burlin Company starts the year with $100,000 in assets and $80,000in liabilities
ID: 2447842 • Letter: B
Question
Burlin Company starts the year with $100,000 in assets and $80,000in liabilities. Net income for the year is $25,000 and no dividendsare paid. How much is owners' equity at the end of the year?Chapman Inc. doubles the amount of its assets from the beginning tothe end of the year. Liabilities at the end of the year amount to$40,000, and owners' equity is $20,000. What ia the amount ofChapman's asset at the end beginning of the year?
During the year, the liabilities of Dixon Enterprises triple inamount. Assets at the beginning of the year amount to $30,000, andowners' equity is $10,000. What is the amount of liabilities at theend of the year?
Explanation / Answer
Owners Equity at begining of Year is 100000-80000=20,000.(Asset=Liability+Owner Eq). Net Inc is $25,000. Therefore at end of Year, Acctg eqn mustbalance. So Owner's equity at End of year will be 20,000+25000 =$45000.2. Chapman: A end of Year. As per above acctg eqn, Assets =Liability + OE = 40,000+20000=60,000. So Asset at begining of year = 1/2 at end of year =$30,000
3. Dixon: As per above Accctg eqn, Begining of year Liability = Asset-Owner Eq =30,000-10,000=$20,000 As end of year liability is tripled, it will be3x20000=$60,000
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