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23 October, 22:06

The stockholders' equity of Kowalski Company at the beginning and end of 2018 totaled $ 122 comma 000 and $ 140 comma 000 , respectively. Assets at the beginning of 2018 were $ 149 comma 000. If the liabilities of Kowalski Company increased by $ 69 comma 000 in 2018 , how much were total assets at the end of 2018 ? Use the accounting equation. A. $ 218 comma 000 B. $ 62 comma 000 C. $ 236 comma 000 D. $ 220 comma 000

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  1. 24 October, 00:25
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    Option (c) is correct.

    Explanation:

    According to the accounting equation,

    Assets = Liabilities + Shareholder Equity

    Increase in equity of stockholders:

    = Ending stockholders equity - Beginning stockholders equity

    = $140,000 - $122,000

    = $18,000

    Increase in asset during 2018:

    = Total asset at the end of 2018 - total asset at the beginning of 2018

    Hence,

    Increase in asset during 2018 = Increase in liabilities + Increase in equity of stockholders

    (Total asset at the end of 2018 - total asset at the beginning of 2018) = (Increase in liabilities + Increase in equity of stockholders)

    (Total asset at the end of 2018 - $149,000) = ($69,000 + $18,000)

    Total asset at the end of 2018 = $87,000 + $149,000

    = $236,000
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