Question

Q3 PART B AND C

Assocat 720,000 Liabilitas = 480,000 240,ooo 3. Carla's Computer Repair Shop started the year with total assets of $720,000 and total Tiabilities of $480.000. During the year, the business recorded $1.200,000 in computer repair revenues. $680,000 in expenses, and the company paid dividends of $120,000 (Show your work) a) Equity at the end of the year was 1200,000 -(680,000+ 120,000 (40o,ooo) b) The net income reported by Carla's Computer Repair Shop for the year was Revenue - expenses 1,200,000 -68,000 + 520,000 c) Total equity changed by what amount from the beginning of the year to the end of the year? of increase use to (400,000) = 160,000 increasing. Problem 1 (4 Points) Use the following information from XYZ Company to calculate total liabilities on Dec 31, 2018 (Show your work) Assets = 171,900 Total Assets $171,900 on Dec 31, 2018 Share Capital $10,000 on Dec 31, 2018 Revenues $ 16,400 in 2018 Expenses $12,300 in 2018 Dividends $1500 declared and paid in 2018 Retained earnings $9.350 on Jan 1, 2018 equity - (10,000 thenya +9,350 +16,400) - ( 12, 300 + 1500 Equity = 21,950 171,900= L + 21,950 (L=149, 950

Answer 1

3a. Calculation of Opening Equity Total Assets Less: Liabilities Opening Equity $ $ $ 7,20,000 4,80,000 2,40,000 Calculation of Closing Equity Opening Equity Add:Net Income Less:Dividend Closing Equity $ $ $ $ 2,40,000 5,20,000 1200000-680000 -1,20,000 6,40,000 3b. Net Income of Carla Computer Repair shop Repair Revenue $ 12,00,000 Less: Expenses $ -6,80,000 Net Income $ 5,20,000 Note: Dividend will not reflected in Income Statement, it will come in Retained Earnings or Closing capital 3c. Closing Equity Opening Equity Change in Equity $ $ $ $ 6,40,000 -2,40,000 4,00,000 0,40.000