FINANCIAL ACCT.F/UNDERGRADS-W/ACCESS
FINANCIAL ACCT.F/UNDERGRADS-W/ACCESS
1st Edition
ISBN: 9781618531612
Author: Wallace, Nelson, Christensen, Ferris
Publisher: Cambridge
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Chapter 2, Problem 8BP
To determine

Calculate the unknown amounts indicated by letters.

Expert Solution & Answer
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Explanation of Solution

Financial statements:

Financial statements are condensed summary of transactions communicated in the form of reports for the purpose of decision making.

(a)

Calculate the sales revenue:

Ending stockholders’ equity} = {Beginning stockholders’ equity + Common stock during the year + Sales revenue – Expenses – Dividends}Sales revenue={Ending stockholders’ equityBeginning stockholders’ equity  Common stock during the year +  Expenses +Dividends}=$12,700 (1)$19,400 (2)$2,000+$9,500+$5,000=$5,800

Therefore, the value of sales revenue is $5,800.

Working notes:

Calculate the value of ending stockholder’s equity.

Ending stockholder's equity = Ending assets- Ending liabilties=$30,000$17,300=$12,700 (1)

Calculate the value of beginning stockholder’s equity.

Beginning stockholder's equity = Beginning  assets- Beginning liabilties=$38,000$18,600=$19,400 (2)

(b)

Calculate the ending liability:

Ending liabilities}={Ending assets  – Stockholders' equity (4)}=$36,000  $18,600=$17,400

Therefore, the value of ending liability is $17,400.

Working notes:

Calculate the value of beginning stockholders equity.

Beginning stockholders’ equity}=Beginning assets – Beginning liabilities=$12,000  $5,000=$7,000 (3)

Calculate the value of ending stockholders equity.

Ending  stockholders' equity}={Beginning stockholders’ equity (3) + Common stock + Sales revenue –Expenses – Dividends}=($7,000+$6,100+$28,000$1,500$21,000)=$18,600 (4)

(c)

Calculate the value of common stock.

Ending stockholders’ equity} = {Beginning stockholders’ equity + Common stock during the year + Sales revenue – Expenses – Dividends}Common stock={Ending stockholders’ equity (5)Beginning stockholders’ equity (6) Sales revenue + Expenses + Dividends}=$26,000$18,000$18,000+$11,000+$2,000=$3,000

Therefore, the value of common stock is $3,000.

Working notes:

Calculate the value of ending stockholders equity.

Ending stockholder's equity = Ending assets- Ending liabilties=$41,000$15,000=$26,000 (5)

Calculate the value of beginning stockholders equity.

Beginning stockholder's equity = Beginning  assets- Beginning liabilties=$28,000$10,000=$18,000 (6)

(d)

Calculate the value of beginning assets:

Beginning assets={Beginning liabilities + Beginning stockholders' equity (8)}=$9,000 + $18,000=$27,000

Therefore, the value of beginning assets is $27,000.

Working notes:

Calculate the value of ending stockholder’s equity.

Ending stockholder's equity = Ending assets- Ending liabilties=$37,000$15,000=$22,000 (7)

Calculate the value of beginning stockholders equity.

Beginning  stockholders' equity}={Ending stockholders’ equity (7) Common stock Sales revenue +Expenses + Dividends}=($22,000$3,500$24,000+$17,000+$6,500)=$18,000 (8)

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Chapter 2 Solutions

FINANCIAL ACCT.F/UNDERGRADS-W/ACCESS

Ch. 2 - Prob. 11SSQCh. 2 - Prob. 12SSQCh. 2 - Prob. 13SSQCh. 2 - Prob. 14SSQCh. 2 - Prob. 15SSQCh. 2 - Prob. 16SSQCh. 2 - Prob. 17SSQCh. 2 - Prob. 1QCh. 2 - Prob. 2QCh. 2 - Prob. 3QCh. 2 - Prob. 4QCh. 2 - Prob. 5QCh. 2 - Prob. 6QCh. 2 - Prob. 7QCh. 2 - Prob. 8QCh. 2 - Prob. 9QCh. 2 - Prob. 10QCh. 2 - Prob. 11QCh. 2 - Prob. 12QCh. 2 - Prob. 13QCh. 2 - Prob. 14QCh. 2 - Prob. 15QCh. 2 - Prob. 16QCh. 2 - Prob. 17QCh. 2 - Prob. 18QCh. 2 - Prob. 19QCh. 2 - Prob. 20QCh. 2 - Prob. 21QCh. 2 - Prob. 22QCh. 2 - Prob. 23QCh. 2 - Prob. 1SECh. 2 - Prob. 2SECh. 2 - Prob. 3SECh. 2 - Prob. 4SECh. 2 - Prob. 5SECh. 2 - Prob. 6SECh. 2 - Prob. 7SECh. 2 - Prob. 8SECh. 2 - Prob. 9SECh. 2 - Prob. 10SECh. 2 - Prob. 11SECh. 2 - Prob. 1AECh. 2 - Prob. 2AECh. 2 - Prob. 3AECh. 2 - Prob. 4AECh. 2 - Prob. 5AECh. 2 - Prob. 6AECh. 2 - Prob. 7AECh. 2 - Prob. 8AECh. 2 - Prob. 9AECh. 2 - Prob. 10AECh. 2 - Prob. 11AECh. 2 - Prob. 12AECh. 2 - Prob. 13AECh. 2 - Prob. 14AECh. 2 - Prob. 15AECh. 2 - Prob. 16AECh. 2 - Prob. 1BECh. 2 - Prob. 2BECh. 2 - Prob. 3BECh. 2 - Prob. 4BECh. 2 - Prob. 5BECh. 2 - Prob. 6BECh. 2 - Prob. 7BECh. 2 - Prob. 8BECh. 2 - Prob. 9BECh. 2 - Prob. 10BECh. 2 - Prob. 11BECh. 2 - Prob. 12BECh. 2 - Prob. 13BECh. 2 - Prob. 14BECh. 2 - Prob. 15BECh. 2 - Prob. 16BECh. 2 - Prob. 1APCh. 2 - Prob. 2APCh. 2 - Prob. 3APCh. 2 - Prob. 4APCh. 2 - Prob. 5APCh. 2 - Prob. 6APCh. 2 - Prob. 7APCh. 2 - Prob. 8APCh. 2 - Prob. 9APCh. 2 - Prob. 10APCh. 2 - Prob. 11APCh. 2 - Prob. 12APCh. 2 - Prob. 13APCh. 2 - Prob. 14APCh. 2 - Prob. 15APCh. 2 - Prob. 16APCh. 2 - Prob. 17APCh. 2 - Prob. 1BPCh. 2 - Prob. 2BPCh. 2 - Prob. 3BPCh. 2 - Prob. 4BPCh. 2 - Prob. 5BPCh. 2 - Prob. 6BPCh. 2 - Prob. 7BPCh. 2 - Prob. 8BPCh. 2 - Prob. 9BPCh. 2 - Prob. 10BPCh. 2 - Prob. 11BPCh. 2 - Prob. 12BPCh. 2 - Prob. 13BPCh. 2 - Prob. 14BPCh. 2 - Prob. 15BPCh. 2 - Prob. 16BPCh. 2 - Prob. 17BPCh. 2 - Prob. 2SPCh. 2 - Prob. 1EYKCh. 2 - Prob. 2EYKCh. 2 - Prob. 3EYKCh. 2 - Prob. 4EYKCh. 2 - Prob. 5EYKCh. 2 - Prob. 6EYKCh. 2 - Prob. 7EYKCh. 2 - Prob. 8EYKCh. 2 - Prob. 9EYKCh. 2 - Prob. 11EYK
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