Question

Use the basic accounting equation to answer the following: a. Hawkins Company has total assets of $150,000 and total liabilities of $110,000. How much is the company’s total stockholders’ equity? $Answer 0 b. Paul Company has total liabilities of $170,000 and total stockholders’ equity of $105,000. How much total assets does the company have? $Answer 0 c. If Black Company’s total assets increased by $35,000 during the year, and its total liabilities decreased during the same year by $20,000, what was the change in the company’s total stockholders’ equity?

Answer 1

Answer:

a. $4,0000

b. $275,000

c. $55,000

Explanation:

In this question, we apply the accounting equation which is shown below:

Total assets = Total liabilities + stockholder equity

a. The stockholder equity would be equal to

= Total assets - total liabilities

= $150,000 - $110,000

= $40,000

b. New liabilities = $170,000

And, the new stockholder equity = $105,000

So, the total assets = Total liabilities + stockholder equity

                                = $170,000 + $105,000

                                = $275,000

c.The change in total stockholder equity equals to

= Increased value of total assets - decreased value of total liabilities

= $35,000 -  (-$20,000)

= $35,000 + $20,000

= $55,000