ACCT CH. (1.3) Apply the accounting equation to business organizations

C. an economic resource​ that's expected to benefit future operations

The nature of an asset is best described as: A. something with physical form​ that's valued at cost in the accounting records. B. something owned by a business that has a ready market value. C. an economic resource​ that's expected to benefit future operations. D. an economic resource representing cash or the right to receive cash in the future.

$335,000-$95,000=$240,000 Revenues-Expenses=Net income (loss)

A company reported monthly revenues of $335,000 and expenses of $95,000. What is the result of operations for the​ month? **In order to calculate the operations for the month we must compute net income or net loss. Begin by determining the equation to compute net income or​ loss, then enter the amounts to solve for the operations for the month. EQ for Net Income (Loss): Revenues-Expenses=Net income (loss)

B.+ $153,000

During the​ year, ChemClean Corporation has $280,000 in​ revenues, $125,000 in​ expenses, and $2,000 in dividend declarations and payments.​ Stockholders' equity changed by **Revenues - Expenses - Dividends = S.H. Equity A.+ $155,000 B.+ $153,000 C.+ $157,000 D.+ $ 278,000

C. Increase assets and increase​ stockholders' equity

How would net income be most likely to affect the accounting​ equation? A. Decrease assets and decrease liabilities B. Increase assets and increase liabilities C. Increase assets and increase​ stockholders' equity D. Increase liabilities and decrease​ stockholders' equity

$260,000-$170,000=$90,000 Assets-Liabilities=Owner's Equity

If the assets of a business are $260,000 and the liabilities are $170,000​, how much is the​ owners' equity? Acct. EQ: Assets-Liabilities=Owner's Equity

$90,000+$90,000=$180,000 Owner's Equity +Liabilities=Assets

If the​ owners' equity in a business is $90,000 and the liabilities are $90,000​, how much are the​ assets? Rearranged Acct. EQ: Owner's Equity +Liabilities=Assets

Ending retained earnings = $194,000

If the beginning balance of retained earnings is $170,000​, revenue is $95,000​, expenses total $65,000​, and the company declares and pays a $6,000 ​dividend, what is the ending balance of retained​ earnings? ​ **Let's begin by selecting the labels in the summarized statement of retained earnings and then enter the amounts to calculate the ending balance of retained earnings for the company. Statement of Retained Earnings Beginning retained earnings = $170,000 Add: Net income for the period = $30,000 Sub-Total = $200,000 Less: Dividends declared = (6,000) Ending retained earnings = $194,000

C. $80,000.

Stafford Company had total assets of $215,000 and total​ stockholders' equity of $48,000 at the beginning of the year. During the​ year, assets increased by $40,000 and liabilities increased by $8,000. ​Stockholders' equity at the end of the year is: A. $96,000. B. $103,000. C. $80,000. D. $88,000. **In order to calculate the amount that​ stockholders' equity has increased during the​ year, we must use the accounting equation. Begin by reviewing the accounting equation. Assets=Liabilities+Stockholders' equity 1. The accounting equation can be rearranged to determine the beginning amount of liabilities. If beginning assets are $215,000 and beginning​ stockholders' equity is $48,000​, calculate the beginning amount of liabilities. Assets-Stockholders' equity=Liabilities $215,000-$48,000=$167,000 2. Recall that the accounting equation must always balance. If assets increased by $40,000 and liabilities increased by $8,000 determine the amount that​ stockholders' equity increased during the year. We will rearrange the accounting equation again to solve for the increase in​ stockholders' equity. Assets-Liabilities=Stockholders' equity Beginning Balance $215,000-$167,000=$48,000 Increase in account $40,000-$8,000=$32,000 3. Using the information you calculated​ above, determine the​ stockholders' equity balance at​ year-end. Stockholders' equity, beg.+Change in stockholders' equity=Stockholders' equity, end. $48,000+$32,000=$80,000 4. Now​ let's look at the accounting equation for the final balances of each component. Assets=Liabilities+Stockholders' equity Beginning Balance $215,000=$167,000+$48,000 Increase in account $40,000=$8,000+$32,000 Ending Balance $255,000=$175,000+$80,000