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    Adjusting Entry: Kalt Company

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    Please help with the following problem.

    Kalt Company recorded journal entries for the payment of $50,000 of dividends, the $32,000 increase in accounts receivable for services rendered, and the purchase of equipment for $21,000. What net effect do these entries have on owners' equity?
    a. Decrease of $71,000.
    b. Decrease of $39,000.
    c. Decrease of $18,000.
    d. Increase of $11,000.

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    Solution Preview

    Question: Kalt Company recorded journal entries for the payment of $50,000 of dividends, the $32,000 increase in accounts receivable for services rendered, and the purchase of equipment for $21,000. What net effect do these entries have on owners' equity?
    a. Decrease of $71,000.
    b. Decrease of $39,000.
    c. Decrease of $18,000.
    d. Increase of $11,000.

    Answer: Owner's Equity will decrease by $18000 by the following two entries.

    Item Journal ...

    Solution Summary

    This solution explains how to adjust entry for the Kalt Company. Charts are provided along with the solution.

    $2.49

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