Exercise 1-9 Using the accounting equation LO A1

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Exercise 1-9 Using the accounting equation LO A1

[The following information applies to the questions displayed below.]

Answer the following questions. (Hint: Use the accounting equation.)

Exercise 1-9 Part a

a. At the beginning of the year, Addison Company's assets are $279,000 and its equity is $209,250. During the year, assets increase $80,000 and liabilities increase $42,000. What is the equity at year-end?

	Assets	=	Liabilities	+	Equity
Beginning	$279,000	=	$69,750	+	$209,250
Change	80,000	=	42,000	+	38,000
Ending	$359,000	=	$111,750	+	$247,250

Exercise 1-9 Part b

b. Office Store has assets equal to $249,000 and liabilities equal to $219,000 at year-end. What is the equity for Office Store at year-end?

Assets	=	Liabilities	+	Equity
$249,000	=	$219,000	+	$30,000

Exercise 1-9 Part c

c. At the beginning of the year, Quaker Company's liabilities equal $66,000. During the year, assets increase by $60,000, and at year-end assets equal $190,000. Liabilities decrease $19,000 during the year. What are the beginning and ending amounts of equity?

	Assets	=	Liabilities	+	Equity
Beginning	$130,000	=	$66,000	+	$64,000
Change	60,000	=	(19,000)	+	79,000
Ending	$190,000	=	$47,000	+	$143,000