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Accounting Equation

Compute the missing amounts for companies A, B, and C.

A B C
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . .$45,000 $ 4,500 $18,000
Accounts receivable . . . . . . . . . . . . . . . . . . . .10,000 10,000 14,000
Land and buildings . . . . . . . . . . . . . . . . . . . . .75,000 ? 50,000
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . ? 12,000 28,000
Mortgage payable . . . . . . . . . . . . . . . . . . . . ..60,000 17,000 22,000
Owners' equity . . . . . . . . . . . . . . . . . . . . . . ..45,000 15,000 ?

Exercise 2-4
Computing Elements of Owners' Equity
From the information provided, determine:
1. The amount of retained earnings at December 31.
2. The amount of revenues for the period.

Totals January 1 December 31
Current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 10,000 15,000
All other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190,000 180,000
Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65,000 45,000
Capital stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .60,000 ?
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75,000 ?

Additional data:
Expenses for the period were $75,000.
Dividends paid were $11,500.
Capital stock increased by $10,000 during the period.

Solution Summary

Excel file contains calculation of missing amounts in table, the amount of retained earnings at end of the period and the amount of revenues for the period.

$2.19