Question

Assets Liabilities Beginning of Year: $25,000 $19,000 End of Year: $60,000 $26,000 1) What is the equity at the beginning of the year? Beginning Equity 3) If the company issues common stock of $8,500 and pay dividends of $44,300, how much is net income (loss)? Net Income (Loss) 5) If the company issues common stock of $18,800 and net income is $18, 100, how much is dividends? Dividends

Answer 1

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1	Beginning Equity	=	$                      6,000
2	Ending Equity	=	$                   34,000
3	Net Income (loss)	=	$                   63,800
4	Common stock	=	$                   34,700
5	Dividend	=	$                      8,900
6	Net Income (loss)	=	$                  -11,700
	Workings:
1 & 2			Beginning of year	End of year
	Assets	=	$                   25,000	$      60,000
Less:	Liabilities	=	$                   19,000	$      26,000
	Owner's Equity	=	$                      6,000	$      34,000
3
	Ending Equity	=	$                   34,000
Add:	Dividend	=	$                   44,300
Less:	Beginning Equity	=	$                    -6,000
Less:	Common stock issued	=	$                    -8,500
	Net Income (loss)	=	$                   63,800
4
	Ending Equity	=	$                   34,000
Add:	Dividend	=	$                      7,800
Less:	Beginning Equity	=	$                    -6,000
Less:	Net Income (loss)	=	$                    -1,100
	Common stock issued	=	$                   34,700
5
	Beginning Equity	=	$                      6,000
	Common stock issued	=	$                   18,800
	Net Income (loss)	=	$                   18,100
Less:	Ending Equity	=	$                  -34,000
	Dividend	=	$                      8,900
6
	Ending Equity	=	$                   34,000
Add:	Dividend	=	$                      4,900
Less:	Beginning Equity	=	$                    -6,000
Less:	Common stock issued	=	$                  -44,600
	Net Income (loss)	=	$                  -11,700