Question

Accounting Equation Inspirational Inc. is a motivational consulting business. At the end of its accounting period, December 31, 2017, Inspirational has assets of $588,480 and liabilities of $185,960. Using the accounting equation and considering each case independently, determine the following amounts. a. Stockholders' equity as of December 31, 2017. $ 402,520 b. Stockholders' equity as of December 31, 2018, assuming that assets increased by $92,980 and liabilities increased by $55,910 during 2018. C. Stockholders' equity as of December 31, 2018, assuming that assets decreased by $46,490 and liabilities increased by $16,480 during 2018. d. Stockholders' equity as of December 31, 2018, assuming that assets increased by $77,680 and liabilities decreased by $29,420 during 2018. e. Net income (or net loss) during 2018, assuming that as of December 31, 2018, assets were $741,480, liabilities were $120,640, and no additional capital stock was issued or dividends paid.

Answer 1

	Assets	Liabilities	Equity
a.	588480	185960	402,520
b.	681460	241870	439,590
c.	541990	202440	339,550
d.	666160	156540	509,620
e.	741480	120640	620,840	Net Income	218,320
Net Income = Change in Equity - Additional stock issued+Dividend paid

2 1 Accounting Equation is As Assets 3 a. 588480 4. b. =B3+92980 5 c. =B3-46490 =B3+77680 741480 8 Net Income = Change in E Liabilities 185960 =C3+55910 =C3+16480 =C3-29420 120640 Equity =B3-C3 =B4-C4 =B5-C5 =B6-C6 =B7-C7 6 d. 7 e. Net Income =D7-D3