Missing Amounts from Balance Sheet and Income Statement Data One item is omitted

Question

Missing Amounts from Balance Sheet and Income Statement Data
One item is omitted in each of the following summaries of balance sheet and income statement data for the following four different corporations. Enter the missing amounts. (Hint: First determine the amount of increase or decrease in stockholders' equity during the year.)
Aquarius Libra Scorpio Taurus
Beginning of the year:
Assets $344,300 $392,500 $158,400
Liabilities 206,600 204,100 120,400 $187,500
End of the year:
Assets 426,900 549,500 142,600 387,400
Liabilities 185,900 172,700 126,700 212,500
During the year:
Additional issuance of capital stock 78,500 15,800 62,500
Dividends 24,100 23,600 91,700
Revenue 113,700 182,200 175,000
Expenses 62,000 102,100 194,800 200,000

Explanation / Answer

Solution:

First figure out beginning of year equity (remember A=L+E):
540-324=216,000

Now do the necessary deductions and additions to the beginning of year equity:
216000+ (a) - 36000 + 177975 - 97200 = 260,775 + (a)

Now calculate what the end of year equity is:
670500-292500=378,000

So, the beginning of year equity was 216,000, then we add the transactions that happened throughout the year (revenue of 177975 and some unknown amount (a)) and subtract (withdrawals of 36000 and expenses of 97200), and find that the end of the year equity is 260,775+(a)=378,000. Now just use algebra to find (a)
(a)= 378000-260775= 117,225

All the others are just variations of this first one, so you should be able to figure it out. Sometimes you just have to take a step back and realize what is being added and subtracted from where.

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