At the beginning of the year, Cullumber Company had total assets of $864,000 and total liabilities of $523,000. (Treat each item independently.) (a) If total assets increased $156,000 during the year and total liabilities decreased $86,000, what is the amount of stockholders' equity at the end of the year? Stockholders' equity $enter a dollar amount (b) During the year, total liabilities increased $91,000 and stockholders' equity decreased $77,000. What is the amount of total assets at the end of the year? Total assets $enter a dollar amount (c) If total assets decreased $90,000 and stockholders' equity increased $103,000 during the year, what is the amount of total liabilities at the end of the year? Total liabilities $enter a dollar amount

Question

Pranav Tucker

Business

12 March, 10:58

At the beginning of the year, Cullumber Company had total assets of $864,000 and total liabilities of $523,000. (Treat each item independently.) (a) If total assets increased $156,000 during the year and total liabilities decreased $86,000, what is the amount of stockholders' equity at the end of the year? Stockholders' equity $enter a dollar amount (b) During the year, total liabilities increased $91,000 and stockholders' equity decreased $77,000. What is the amount of total assets at the end of the year? Total assets $enter a dollar amount (c) If total assets decreased $90,000 and stockholders' equity increased $103,000 during the year, what is the amount of total liabilities at the end of the year? Total liabilities $enter a dollar amount

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Answers (1)

Know the Answer?

Talon Livingston · Answer 1

a. $583,000

b. $878,000

c. $330,000

Explanation:

In this question, we have to use the accounting equation which is presented below:

Total assets = Total liabilities + stockholder's equity

$864,000 = $523,000 + stockholder's equity

So, the stockholder's equity = $864,000 - $523,000 = $341,000

a. New assets = Old assets + addition

= $864,000 + $156,000

= $1,020,000

New liabilities = Old liabilities - reduction

= $523,000 - $86,000

= $437,000

So, the stockholder's equity = $1,020,000 - $437,000 = $583,000

b. New liabilities = Old liabilities + addition

= $523,000 + $91,000

= $614,000

New equity = Old equity - reduction

= $341,000 - $77,000

= $264,000

So, the total assets = New liabilities + New equity

= $614,000 + $264,000

= $878,000

c. New assets = Old assets - reduction

= $864,000 - $90,000

= $774,000

New equity = Old equity + addition

= $341,000 + $103,000

= $444,000

So, the total liabilities = $774,000 - $444,000 = $330,000