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Accounting equation Annie Rasmussen is the owner and operator of Go44, a motivational consulting business. At the end of its accounting period, December 31, 2015, Go44 has assets of $720,000 and liabilities of $180,000. Using the accounting equation and considering each case independently, determine the following amounts: a. Annie Rasmussen, capital, as of December 31, 2015. b. Annie Rasmussen, capital, as of December 31, 2016, assuming that assets increased by $96,500 and liabilities increased by $30,000 during 2016. c. Annie Rasmussen, capital, as of December 31, 2016, assuming that assets decreased by $168,000 and liabilities increased by $15,000 during 2016. d. Annie Rasmussen, capital, as of December 31, 2016, assuming that assets increased by $175,000 and liabilities decreased by $18,000 during 2016. e. Net income (or net loss) during 2016, assuming that as of December 31, 2016, assets were $880,000, liabilities were $220,000, and there were no additional investments or withdrawals.

BuyFind

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781285743615
BuyFind

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
Publisher: Cengage Learning
ISBN: 9781285743615

Solutions

Chapter
Section
Chapter 1, Problem 1.7EX
Textbook Problem

Accounting equation

Annie Rasmussen is the owner and operator of Go44, a motivational consulting business. At the end of its accounting period, December 31, 2015, Go44 has assets of $720,000 and liabilities of $180,000. Using the accounting equation and considering each case independently, determine the following amounts:

  1. a. Annie Rasmussen, capital, as of December 31, 2015.
  2. b. Annie Rasmussen, capital, as of December 31, 2016, assuming that assets increased by $96,500 and liabilities increased by $30,000 during 2016.
  3. c. Annie Rasmussen, capital, as of December 31, 2016, assuming that assets decreased by $168,000 and liabilities increased by $15,000 during 2016.
  4. d. Annie Rasmussen, capital, as of December 31, 2016, assuming that assets increased by $175,000 and liabilities decreased by $18,000 during 2016.
  5. e. Net income (or net loss) during 2016, assuming that as of December 31, 2016, assets were $880,000, liabilities were $220,000, and there were no additional investments or withdrawals.

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Chapter 1 Solutions

Accounting (Text Only)
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