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Alexis Company was started in Year 1. At the end of Year 1 the Company had the following accounting equation. Assets Liabilities + Stockholders' Equity Cash + Land = Notes Payable + Common Stock + Retained Earnings 600 + 2,200 = 1,000 1,400 + 400 During Year 2, the company experienced the following accounting events. Paid off $500 of its notes payable. Earned $700 of cash revenue. Paid $400 of cash expenses. Paid a $100 cash dividend. Based on this information alone, what percent of the company's assets at the end of Year 2 was provided by creditors?

Alexis Company was started in Year 1. At the end of Year 1 the Company had the following accounting equation. Assets Liabilities + Stockholders' Equity Cash + Land = Notes Payable + Common Stock + Retained Earnings 600 + 2,200 = 1,000 1,400 + 400 During Year 2, the company experienced the following accounting events. Paid off $500 of its notes payable. Earned $700 of cash revenue. Paid $400 of cash expenses. Paid a $100 cash dividend. Based on this information alone, what percent of the company's assets at the end of Year 2 was provided by creditors?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Alexis Company was started in Year 1. At the end of Year 1 the Company had the following accounting equation. Assets Liabilities + Stockholders' Equity Cash + Land = Notes Payable + Common Stock + Retained Earnings 600 + 2,200 = 1,000 1,400 + 400 During Year 2, the company experienced the following accounting events. Paid off $500 of its notes payable. Earned $700 of cash revenue. Paid $400 of cash expenses. Paid a $100 cash dividend. Based on this information alone, what percent of the company's assets at the end of Year 2 was provided by creditors?
Transcribed Image Text:Alexis Company was started in Year 1. At the end of Year 1 the Company had the following accounting equation. Assets Liabilities + Stockholders' Equity Cash + Land = Notes Payable + Common Stock + Retained Earnings 600 + 2,200 = 1,000 1,400 + 400 During Year 2, the company experienced the following accounting events. Paid off $500 of its notes payable. Earned $700 of cash revenue. Paid $400 of cash expenses. Paid a $100 cash dividend. Based on this information alone, what percent of the company's assets at the end of Year 2 was provided by creditors?
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