For the year, Beta had beginning total liabilities of $30,000 and ending total l
ID: 2503703 • Letter: F
Question
For the year, Beta had beginning total liabilities of $30,000 and ending total liabilities of $20,000. During the year, total assets increased $25,000. The beginning balance in stockholder's equity was $40,000. In addition, common stock of $10,000 was sold at par value, and dividends of $5,000 were declared and paid. How much was Beta's net income for the year? (hint use increases/decreases in the accounting equation to solve this problem)
Please list all steps and how each transation effects the equation.
Explanation / Answer
TOTAL ASSETS AT THE BEGINNING OF THE YEAR = BEGINNING TOTAL LIABILITIES + BEGINNING BALANCE IN STOCK HOLDER