Ginger Enterprises began the year with total assets of $485,000 and total liabil

Question

Ginger Enterprises began the year with total assets of $485,000 and total liabilities of $223,000. Using this information and the accounting equation, answer each of the following independent questions. 1. What was the amount of Ginger's owners' equity at the beginning of the year? $ 2. If Ginger's total assets increased by $107,000 and its total liabilities increased by $81,000 during the year, what was the amount of Ginger's owners' equity at the end of the year? $ 3. If Ginger's total liabilities decreased by $29,000 and its owners' equity increased by $60,000 during the year, what was the amount of its total assets at the end of the year? $ 4. If Ginger's total assets doubled to $970,000 and its owners' equity remained the same during the year, what was the amount of its total liabilities at the end of the year? $

Explanation / Answer

Accounting Equation:

Assets = Liabilities+equity

1 equity = 485000-223000 = 262000

2 Equity = (485000+107000)-(223000+81000) = 288000

3 Assets = (223000-29000)+(262000+60000) = 516000

4 Liabilities = (970000)-262000 = 708000

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