FINANCIAL ACCT-CONNECT
FINANCIAL ACCT-CONNECT
8th Edition
ISBN: 9781266627903
Author: Wild
Publisher: INTER MCG
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Chapter 1, Problem 2PSA

1.

Summary Introduction

Introduction:Balance sheet is a financial statement which is prepared at the end of an accounting year to show the balance of assets, liabilities and the equity of the company. The assets of the company are equal to the amount of liabilities plus equity.

To calculate:

(a) The amount of equity for company A on December 31, 2015.

(b) The amount of equity for company A on December 31, 2016

(c) The amount of liabilities for company A on December 31, 2016.

1.

Expert Solution
Check Mark

Explanation of Solution

(a)

December 31, 2015:

Assets: $55,000

Liabilities: $24,500

  Equity=assets-liabilities=$55,000$24,500=$30,500

Therefore, the amount of beginning equity is $30,500.

(b)

December 31, 2016:

    Particular Amount ($)
    Beginning balance of equity 30,500
    Add: stock insurance 6,000
    Add: net income 8,500
    Less: Cash dividend (3,500)
    Ending balance of equity 41,500

Therefore, the amount of ending equity is $41,500.

(c)

Liabilities on December 31, 2016:

Assets: $58,000

Equity: $41,500

  Liabilites=assetsequity=$58,000$41,500=$16,500

Therefore, the amount of liabilities is $16,500.

2.

Summary Introduction

Introduction:Balance sheet is a financial statement which is prepared at the end of an accounting year to show the balance of assets, liabilities and the equity of the company. The assets of the company are equal to the amount of liabilities plus equity.

To calculate: (a) The amount of equity for company B on December 31, 2015. (b) The amount of equity for company B on December 31, 2016 (c) The net income of company B for the year ending on December 31, 2016.

2.

Expert Solution
Check Mark

Explanation of Solution

(a)

December 31, 2015:

Assets: $34,000

Liabilities: $21,500

  Equity=assets-liabilities=$34,000$21,500=$12,500

Therefore, the amount of beginning equity is $12,500.

(b)

December 31, 2015:

Assets: $40,000

Liabilities: $26,500

  Equity=assets-liabilities=$40,000$26,500=$13,500

Therefore, the amount of ending equity is $13,500.

(c)

The amount of net income for year 2016:

    Particular Amount ($)
    Ending balance of equity 13,500
    less: beginning balance of equity(12,500)
    Less: stock insurance (1,400)
    Add: Cash dividend 2,000
    Net income 1,600

Therefore, net income for the year 2016 is $1,600.

3.

Summary Introduction

Introduction:Balance sheet is a financial statement which is prepared at the end of an accounting year to show the balance of assets, liabilities and the equity of the company. The assets of the company are equal to the amount of liabilities plus equity.

To calculate: The amount of assets for company C on December 31, 2016.

3.

Expert Solution
Check Mark

Explanation of Solution

The amount of assets on December 31, 2016:

Beginning equity is calculated as:

Assets: $24,000

Liabilities: $9,000

  Beginningequity=assets-liabilities=$24,000$9,000=$15,000

Therefore, the amount of beginning equity is $15,000.

Ending equity is calculated as:

    Particular Amount ($)
    Beginning balance of equity 15,000
    Add: stock insurance 9,750
    Add: net income 8,000
    Less: Cash dividend (5,875)
    Ending balance of equity 26,875

Therefore, the amount of ending equity is $26,875.

Assets on December 31, 2016:

Liabilities: $29,000

Ending equity: $26,875

  Asets=liability+equity=$29,000+$26,875=$55,875

Therefore, amount of assets is $55,875.

4.

Summary Introduction

Introduction:Balance sheet is a financial statement which is prepared at the end of an accounting year to show the balance of assets, liabilities and the equity of the company. The assets of the company are equal to the amount of liabilities plus equity.

To calculate: The amount of stock insurance for company D on December 31, 2016.

4.

Expert Solution
Check Mark

Explanation of Solution

The amount of stock insurance on December 31, 2016:

Beginning equity is calculated as:

Assets: $60,000

Liabilities: $40,000

  Beginningequity=assets-liabilities=$60,000$40,000=$20,000

Therefore, the amount of beginning equity is $20,000.

Ending equity is calculated as:

Assets: $85,000

Liabilities: $24,000

  Endingequity=assets-liabilities=$85,000$24,000=$61,000

Therefore, the amount of ending equity is $61,000.

Stock insurance is calculated as:

    Particular Amount ($)
    Ending balance of equity 61,000
    less: beginning balance of equity(20,000)
    Less: net income (14,000)
    Add: Cash dividend 0
    Stock insurance 27,000

Therefore, the amount of stock insurance is $27,000.

5.

Summary Introduction

Introduction:Balance sheet is a financial statement which is prepared at the end of an accounting year to show the balance of assets, liabilities and the equity of the company. The assets of the company are equal to the amount of liabilities plus equity.

To calculate: The amount of liabilities for company E on December 31, 2015.

5.

Expert Solution
Check Mark

Explanation of Solution

The amount of liabilities on December 31, 2015:

Ending equity is calculated as:

Assets: $113,000

Liabilities: $70,000

  Endingequity=assets-liabilities=$113,000$70,000=$43,000

Therefore, the amount of ending equity is $43,000.

Beginning equity is calculated as:

    Particular Amount ($)
    Ending balance of equity 43,000
    Add: cash dividend 11,000
    Less: net income (20,000)
    Less: stock insurance(6,500)
    Beginning balance of equity 27,500

Therefore, the amount of beginning equity is $27,500.

Liabilities on December 31, 2015:

Assets: $119,000

Beginning equity: $27,500

  Liabilities=assetsequity=$119,000+$27,500=$91,500

Therefore, amount of liabilities is $91,500.

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Chapter 1 Solutions

FINANCIAL ACCT-CONNECT

Ch. 1 - Prob. 11DQCh. 1 - Prob. 12DQCh. 1 - What does the concept of objectivity imply for...Ch. 1 - Prob. 14DQCh. 1 - Prob. 15DQCh. 1 - Prob. 16DQCh. 1 - Define (a) assets, (b) liabilities, (c) equity,...Ch. 1 - Prob. 18DQCh. 1 - Prob. 19DQCh. 1 - What do accountants mean by the term revenue?Ch. 1 - Prob. 21DQCh. 1 - Prob. 22DQCh. 1 - Prob. 23DQCh. 1 - Prob. 24DQCh. 1 - Prob. 25DQCh. 1 - Prob. 26DQCh. 1 - Prob. 27DQCh. 1 - Define and explain return on assets.Ch. 1 - Define return and risk. Discuss the trade-off...Ch. 1 - Prob. 30DQCh. 1 - Prob. 31DQCh. 1 - Prob. 32DQCh. 1 - Prob. 33DQCh. 1 - Prob. 34DQCh. 1 - Choose from the following term or phrase a through...Ch. 1 - Prob. 2QSCh. 1 - Prob. 4QSCh. 1 - Prob. 5QSCh. 1 - Prob. 6QSCh. 1 - Prob. 7QSCh. 1 - Applying the accounting equation A1 Use the...Ch. 1 - Prob. 9QSCh. 1 - Prob. 10QSCh. 1 - Prob. 11QSCh. 1 - Prob. 12QSCh. 1 - Prob. 13QSCh. 1 - Prob. 14QSCh. 1 - Prob. 15QSCh. 1 - Prob. 16QSCh. 1 - Prob. 1ECh. 1 - Identifying accounting users and uses C2 Part A....Ch. 1 - Prob. 3ECh. 1 - Prob. 6ECh. 1 - Prob. 7ECh. 1 - Determine the missing amount from each of the...Ch. 1 - Prob. 9ECh. 1 - Prob. 10ECh. 1 - Prob. 11ECh. 1 - Prob. 12ECh. 1 - Prob. 13ECh. 1 - Prob. 14ECh. 1 - Prob. 15ECh. 1 - Use the information in Exercise 1-15 to prepare an...Ch. 1 - Prob. 17ECh. 1 - Prob. 18ECh. 1 - Prob. 19ECh. 1 - Prob. 20ECh. 1 - Prob. 21ECh. 1 - Prob. 1PSACh. 1 - Prob. 2PSACh. 1 - Prob. 3PSACh. 1 - Prob. 4PSACh. 1 - Prob. 5PSACh. 1 - Prob. 6PSACh. 1 - Prob. 8PSACh. 1 - Prob. 9PSACh. 1 - Prob. 10PSACh. 1 - Prob. 11PSACh. 1 - Prob. 12PSACh. 1 - Prob. 13PSACh. 1 - Prob. 14PSACh. 1 - Prob. 1PSBCh. 1 - Prob. 3PSBCh. 1 - Prob. 4PSBCh. 1 - Prob. 5PSBCh. 1 - Prob. 6PSBCh. 1 - Prob. 7PSBCh. 1 - Prob. 8PSBCh. 1 - Prob. 9PSBCh. 1 - Prob. 10PSBCh. 1 - Prob. 11PSBCh. 1 - Prob. 12PSBCh. 1 - Prob. 13PSBCh. 1 - Prob. 14PSBCh. 1 - Prob. 1SPCh. 1 - Prob. 2BTNCh. 1 - Prob. 7BTNCh. 1 - Prob. 9BTN
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