If assets at the end of the year are $245,000, liabilities at year end are $80,000, opening balance of owners' equity is $120,000, and revenue for the year is $165,000, expenses must be:
Question
If assets at the end of the year are 80,000, opening balance of owners' equity is 165,000, expenses must be:
Solution
To find the expenses, we first need to calculate the closing balance of the owner's equity. The formula for owner's equity is:
Owner's Equity = Assets - Liabilities
So, the closing balance of the owner's equity is:
80,000 (Liabilities) = $165,000
Next, we need to find the change in owner's equity. The formula for this is:
Change in Owner's Equity = Closing Balance - Opening Balance
So, the change in owner's equity is:
120,000 (Opening Balance) = $45,000
Finally, we can find the expenses. The formula for this is:
Expenses = Revenue - Change in Owner's Equity
So, the expenses are:
45,000 (Change in Owner's Equity) = $120,000
Therefore, the expenses for the year must be $120,000.
Similar Questions
If assets are $215,611, opening equity is $51,318, liabilities are $125,940 and income is $74,094, expenses must be:
If assets are $253,099 and equity is $136,586, liabilities must be:
On January 31, a company's balance sheet showed net assets of $2,600 and liabilities of $700. Stockholders' equity on January 31 was:Multiple Choice$2,600.$700.$3,300.$1,900.
As of June 30, 2022, Blossom Company has assets of $96000 and stockholders' equity of $40000. What are the liabilities for Blossom Company as of June 30, 2022?Select answer from the options below$136000$40000$56000$96000
Assets Liabilities Accounts payable 25,000Cash 8, 000 Bank overdrafts 1,500Accounts receivables 10, 000 Long term loans 40,000Inventory 10, 000 Total liabilities 66,500Property, Plant and Equipment 100, 000 Shareholders Equity Share capital 35,000 Retained earnings 26, 500Total Assets 128, 000 Total Liabilities and SE 128, 000 You have the following information from the balance sheet of Company X as at 30 June 2018.Calculate current ratio.
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.