Question

Q 1.21: Flex-Mat started the year with total assets of $160,000 and total liabilities of $90,000. During the year, the business recorded $210,000 in revenues, $120,000 in expenses, and dividends of $35,000. Stockholders' equity at the end of the year was

Answer 1

Answer:

$125,000

Explanation:

total assets $160,000 = total liabilities $90,000 + total equity $70,000

income statement:

revenues $210,000

expenses $120,000

net income $90,000

- dividends $35,000

retained earnings $55,000

stockholders' equity at end of the year = $70,000 + $55,000 = $125,000