Question

At the beginning of the year, Addison Company's assets are $259,000 and its equity is $194,250. During the year, assets increase $80,000 and liabilities increase $52,643. What is the equity at the end of the year

Answer 1

Answer:

$92,107 = Equity at the end

Explanation:

Given that,

Beginning assets = $259,000

Beginning equity = $194,250

Increase in assets = $80,000

Increase in liabilities = $52,643

Therefore,

Accounting equation is as follows:

Total Assets = Total liabilities + Stockholders equity

(Beginning assets + Increase in assets) = [Increase in liabilities + (Beginning equity + equity at the end)]

($259,000 + $80,000) = [$52,643 + ($194,250 + Equity at the end)]

$339,000 - $246,893 = Equity at the end

$92,107 = Equity at the end