t the beginning of the year, Addison Company's assets are $300,000 and its equity is $100,000. During the year, assets increase $80,000 and liabilities increase $50,000.

What is the equity at the end of the year?

2. Office Store has assets equal to $123,000 and liabilities equal to $47,000 at year-end.

What is the total equity for Office Store at year-end?

3. At the beginning of the year, Quaker Company's liabilities equal $70,000. During the year, assets increase by $60,000, and at year-end assets equal $190,000. Liabilities decrease $5,000 during the year.

What are the beginning and ending amounts of equity?

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tanveermoledina tanveermoledina · Answer 1 · 2020-02-20T11:07:19+01:00

Answer:

1. Addison Company, Year end Equity $ 130,000

2. Office Store, Year end equity $ 76.000

3. Quaker Company, Beginning Equity $ 60,000 , Year End Equity $ 125,000

Explanation:

1. Addison Company Computation of Year end equity

Opening Equity $ 100,000

By the fundamental accounting equation

Assets = Liabilities + Equity

The increases during the year are:

$ 80,000 = $ 50,000 + Increase in equity

By solving the equation, the increase in equity is $ 30,000

Year end equity $ 130,000

2. Office Store Computation of Year end equity

Assets = Liabilities + Equity

$ 123,000 = $ 47,000 + Equity

By solving the equation

Year end Equity is $ 76,000

3.Quaker Company Computations

Determination of opening equity balance

Opening Assets =Year end asset 190,000- Increase $ 60,000 = $ 130,000

Opening Liabilities $ 70,000

Assets - Liabilities = Owners Equity -Beginning $ 60,000

Determination of ending equity balance

Year End Liabilities = Opening Liabilities - Decrease

$ 70,000 - $ 5,000= $ 65,000

Year end assets $ 190,000

Year end Assets - Year end Liabilities = Year end Equity

$ 190,000 - $ 65,000 = $ 125,000