Accounting EquationPenny Lyman is the owner and operator of Go109, a motivational consulting business. At the end of its accounting period, December 31, 20Y1, Go109 has assets of $598,990 and liabilities of $189,280. Using the accounting equation and considering each case independently, determine the following amounts.a.Penny Lyman, capital, as of December 31, 20Y1.$fill in the blank 1b.Penny Lyman, capital, as of December 31, 20Y2, assuming that assets increased by $94,640 and liabilities increased by$56,900 during 20Y2.$fill in the blank 2c.Penny Lyman, capital, as of December 31, 20Y2, assuming that assets decreased by $47,320 and liabilities increased by$16,770 during 20Y2.$fill in the blank 3d.Penny Lyman, capital, as of December 31, 20Y2, assuming that assets increased by $79,070 and liabilities decreased by$29,950 during 20Y2.$fill in the blank 4e.Net income (or net loss) during 20Y2, assuming that as of December 31, 20Y2, assets were $754,730, liabilities were $122,790,and there were no additional investments or withdrawals.

Solution: As per basic accounting equation: Assets = Liability + Equity Equity or Capital Balance =…

Answered: Penny Lyman is the owner and operator…

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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Accounting Equation

Penny Lyman is the owner and operator of Go109, a motivational consulting business. At the end of its accounting period, December 31, 20Y1, Go109 has assets of $598,990 and liabilities of $189,280. Using the accounting equation and considering each case independently, determine the following amounts.

a.	Penny Lyman, capital, as of December 31, 20Y1.	$fill in the blank 1
b.	Penny Lyman, capital, as of December 31, 20Y2, assuming that assets increased by $94,640 and liabilities increased by $56,900 during 20Y2.	$fill in the blank 2
c.	Penny Lyman, capital, as of December 31, 20Y2, assuming that assets decreased by $47,320 and liabilities increased by $16,770 during 20Y2.	$fill in the blank 3
d.	Penny Lyman, capital, as of December 31, 20Y2, assuming that assets increased by $79,070 and liabilities decreased by $29,950 during 20Y2.	$fill in the blank 4
e.	Net income (or net loss) during 20Y2, assuming that as of December 31, 20Y2, assets were $754,730, liabilities were $122,790, and there were no additional investments or withdrawals.

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