Accounting 2301 -WCJC - Summer 2017

If assets are $300,000 and liabilities are $192,000, then equity equals:

$108,000

Charlie's Chocolates Inc.'s stockholders made investments of $50,000 and dividends of $20,000. The company has revenues of $83,000 and expenses of $64,000. Calculate its net income.

$19,000.

A company's balance sheet shows: cash $22,000, accounts receivable $16,000, office equipment $50,000, and accounts payable $17,000. What is the amount of stockholders' equity?

$71,000

All of the following are classified as liabilities except:

Accounts Receivable.

If a company purchases equipment costing $4,500 on credit, the effect on the accounting equation would be:

Assets increase $4,500 and liabilities increase $4,500.

Marsha Bogswell is the owner of Bogswell Legal Services, Inc. Which accounting principle requires Marsha to keep her personal financial information separate from the financial information of Bogswell Legal Services, Inc.?

Business entity assumption.

If the assets of a business increased $89,000 during a period of time and its liabilities increased $67,000 during the same period, equity in the business must have:

Increased $22,000

Atkins Company collected $1,750 as payment for the amount owed by a customer from services provided the prior month on credit. How does this transaction affect the accounting equation for Atkins?

One asset would increase $1,750 and a different asset would decrease $1,750, causing no effect.

An example of an investing activity is:

Purchasing Land

All of the following are classified as liabilities except:

Supplies