Chapter 1Homework - Assignment 1

Smith Company had total assets of $215,000 and total stockholders' equity of $80,000 at the beginning of the year. During the year, assets increased by $43,000 and liabilities increased by $11,00. Stockholders' equity at the end of the year is.

$112,000

The Stockholder's equity of Kovsky Company at the beginning and end of 2014 total $126,000 and $139,000, respectively. Assets at the beginning of 2014 were $150,000. If the liabilities of Kovsky Company increased by $74,000 in 2014, how much were total assets at the end of 2014? Use the accounting equation

$237,000

Regert, Inc., has current assets of $220 million; property, plant, and equipment of $370 million; and other assets totaling $160 million. Current liabilities are $100 million and long-term liabilities total $340 million REQUIREMENTS: 1. Use these data to write Regert's accounting equation. 2. How much in resources does Regert have to work with? 3. How much does Regert owe creditors? 4. How much of the company's assets do the Regert stockholders actually own?

1.Assets: $750 Liabilities: $440 Stockholders' equity: $310 2. 750 3. 440 4.310

Accounting definitions are precise, and you must understand the vocabulary to properly use accounting. Sharpen your understanding of key terms by answering the following questions: 1. How do the assets and owners' equity of Apple, Inc. differ from each other? Which one (assets or owners' equity) must be at least as large as the other? Which one can be smaller than the other? 2. How are Apple, Inc.s liabilities and owners' equity similar? Different?

Assets are the economic resources of a business that are expected to be of benefit in the future. Owners' equity represents claims to the assets held by the owners of the business Assets must be at least as large as owners' equity. Owner's equity can be smaller than assets. Both liabilities and owners' equity are claims to assets. Liabilities are the outsider claims to the assets of a business. Owners' equity represents the insider claim to the assets of the business

The accounting equation can be expressed as

Assets-Liabilities = Owners' equity

Compute the missing amount in the accounting equation for each company (amounts in billions): Perfect Cleaners: Assets $?, Liabilities $43, and stockholders' Equity $33 Northeast Bank: Assets $23, Liabilities $?, and Stockholders' Equity $15 Hair Styles: Assets $30, Liabilities $15, and Stockholders' Equity $?

Perfect Cleaners: Assets $76 Northeast Bank: Liabilities $8 Hair Styles: Stockholders' Equity $15 Northeast Bank appears to have the strongest financial position because its liabilities make the the smallest percentage of company assets. This percentage is 34.78%

Prairie Corporations holds cash of $11,000 and owes $29,000 on accounts payable. Prairie has accounts receivable of $40,000, inventory of $32,000, and land that cost $55,000. How much are Prairie's total assets and liabilities?

Total Assets of $138,000 and Liabilities of $29,000

Supposed you manage a Coffee Run! restaurant. Identify the missing amount for each situation: Total Assets = Total Liabilities + Stockholders' Equity a. $_____?_____ = $290,000=$390,000 b. 95,000 =65,000+_____?_____ c. 390 ,000=_____?_____+ 330,000

a. Total Assets = $680,000 b. Stockholders' Equity = $30,000 c. Total Liabilities = $ 60,000

The nature of an asset is best described as

an economic resource that's expected to benefit future operations

During February, assets increased by $86,000 and liabilities increased by $30,000. Stockholders' equity must have

increased by $56,000

The PRIMARY objective of financial reporting is to provide information

useful for making investment and credit decisions