Question

1. For each of the independent? cases, compute the amounts? (in thousands) for the items indicated by letters.

Before completing each? case, define the following financial equations that we will need to solve for the missing amounts. Begin by selecting the formula to calculate net income.

Revenues

-

Expenses

=

Net income

Select the formula to show the change in the retained earnings account.

Beginning retained earnings

+

Net income

-

Dividends

=

Ending retained earnings

Select the formula to show the change in the? paid-in capital account.

Beginning paid-in capital

+

Additional investment

=

Ending paid-in capital

Select the labels of the expanded balance sheet equation.

Liabilities

+

Retained earnings

+

Paid-in capital

=

Total assets

For each of the independent? cases, compute the amounts? (in thousands) for the missing? items, beginning with Case 1.

Case	1
Revenues	$40
Expenses	20
Dividends declared	0
Additional investment by stockholders	0
Net income	20
Retained earnings
Beginning of year	90
End of year	110
Paid-in capital
Beginning of year	35
End of year	35
Total assets
Beginning of year	150
End of year	200
Total liabilities
Beginning of year	25
End of year	55

2
150
130
21
5
20
140
139
45
50
240
375
55
186

3
$330
240
15
40
122
30
250
198

Enter any number in the edit fields and then click Check Answer.

Answer 1

Independent cases	Total revenue	Total expenses	Net Income C=A-B	Total assets D	Total liabilities E	Retained Earnings	Dicvident declared	ending paid in capital	Stockholder Equity
Case 1	40	20	20	220	55	130		35	165
			(40-20)	(55+130+35)		110+20		35+0=35	35+130
			Revenue-expense=Net Income	Liabilities+Retained Earnings+paid in capital= Total assets		Beg RE+Net income-Dividend		Beg Paid in capital+Additional investments=ending paid in capital
Case 2	150	130	20	375	186	139		50	189
				(186+139+50)				45+5	139+50
				Liabilities+Retained Earnings+paid in capital= Total assets		Beg RE+Net income-Dividend		Beg Paid in capital+Additional investments=ending paid in capital
Case 3	330	240	90	350	198	122	8	30	162
			330-240	198+122+30		40+90-8	122-(40+90)		(122+30)
			Revenue-expense=Net Income	Liabilities+Retained Earnings+paid in capital= Total assets		Beg RE+Net income-Dividend