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29 February, 22:48

At the beginning of the year, Sheridan Company had total assets of $845,000 and total liabilities of $600,000. (Treat each item independently.) (a) If total assets increased $177,000 during the year and total liabilities decreased $71,000, what is the amount of stockholders' equity at the end of the year? (b) During the year, total liabilities increased 592,000 and stockholders' equity decreased $72,000. What is the amount of total assets at the end of the year? (c) If total assets decreased $90,000 and stockholders' equity increased $100,000 during the year, what is the amount of total liabilities at the end of the year?

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  1. 1 March, 01:17
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    A. Stockholders equity at the end is $493,000.

    B. Closing total assets is $865,000.

    C. Closing liability is $410,000.

    Explanation:

    A. Closing total assets:

    = Opening assets + increase in assets

    = $845,000 + $177,000

    = $1,022,000

    Closing liability:

    = Opening liability - Decrease in liability

    = $600,000 - $71,000

    = $529,000

    Closing equity:

    = Closing assets - Closing liability

    = $1,022,000 - $529,000

    = $493,000

    B. Opening equity:

    = Opening assets - Opening liability

    = $845,000 - $600,000

    = $245,000

    Closing assets:

    = Opening assets + increase in liability - Decrease in equity

    = $845,000 + $92,000 - $72,000

    = $865,000

    C. Closing liability:

    = Opening liability - decrease in assets - increase in equity

    = $600,000 - $90,000 - $100,000

    = $410,000
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