1) Acquired $950 cash from the issue of common stock.
2) Borrowed $420 from a bank.
3) Earned $650 of revenues cash.
4) Paid expenses of $250.
5) Paid a $50 dividend.
During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.)
1) Issued an additional $325 of common stock.
2) Repaid $220 of its debt to the bank.
3) Earned revenues of $750 cash.
4) Incurred expenses of $360.
5) Paid dividends of $100.
What was the amount of total stockholders’ equity on Packard's balance sheet at the end of Year 1?
$1,350
$900
$250
$1,300
Beginning balance of stockholders’ equity of $0 + Common stock issued of $950 + Revenues of $650 − Expenses of $250 − Dividends of $50 = Ending
balance of stockholders’ equity of $1,300
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-07 Prepare an income statement, a
statement of changes in stockholders equity, and a balance sheet.
87.
Award: 1.00 point
88.
Award: 1.00 point
Packard Company engaged in the following transactions during Year 1, its first year of operations. (Assume all transactions are cash transactions.)
1) Acquired $1,250 cash from the issue of common stock.
2) Borrowed $720 from a bank.
3) Earned $900 of revenues cash.
4) Paid expenses of $310.
5) Paid a $110 dividend.
During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.)
1) Issued an additional $625 of common stock.
2) Repaid $430 of its debt to the bank.
3) Earned revenues of $1,050 cash.
4) Incurred expenses of $480.
5) Paid dividends of $160.
What is the amount of retained earnings that will be reported on Packard's Year 2 balance sheet?
$890
$670
$1,160
$1,050
Beginning balance of retained earnings of $480 + Revenues of $1,050 revenue − Expense of $480 − Dividends of $160 = Ending balance of retained earnings
of $890
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-07 Prepare an income statement, a
statement of changes in stockholders equity, and a balance sheet.
Packard Company engaged in the following transactions during Year 1, its first year of operations. (Assume all transactions are cash transactions.)
1) Acquired $950 cash from the issue of common stock.
2) Borrowed $420 from a bank.
3) Earned $650 of revenues cash.
4) Paid expenses of $250.
5) Paid a $50 dividend.
During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.)
1) Issued an additional $325 of common stock.
2) Repaid $220 of its debt to the bank.
3) Earned revenues of $750 cash.
4) Incurred expenses of $360.
5) Paid dividends of $100.
What is the amount of retained earnings that will be reported on Packard's Year 2 balance sheet?
$640
$800
$290
$740
Beginning balance of retained earnings of $350 + Revenues of $750 revenue − Expense of $360 − Dividends of $100 = Ending balance of retained earnings of
$640
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-07 Prepare an income statement, a
statement of changes in stockholders equity, and a balance sheet.
89.
Award: 1.00 point
90.
Award: 1.00 point
Packard Company engaged in the following transactions during Year 1, its first year of operations. (Assume all transactions are cash transactions.)
1) Acquired $1,650 cash from the issue of common stock.
2) Borrowed $1,120 from a bank.
3) Earned $1,300 of revenues cash.
4) Paid expenses of $390.
5) Paid a $190 dividend.
During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.)
1) Issued an additional $1,025 of common stock.
2) Repaid $710 of its debt to the bank.
3) Earned revenues of $1,450 cash.
4) Paid expenses of $640.
5) Paid dividends of $240.
What is the amount of total assets that will be reported on Packard's balance sheet at the end of Year 2?
$4,375
$885
$4,615
$810
Year 1: Ending total assets = Beginning total assets of $0 + Cash from issuance of common stock of $1,650 + Cash from borrowing of $1,120 + Cash from
revenues of $1,300 − Cash to pay expenses of $390 − Cash used to pay dividends of $190 = $3,490
Year 2: Ending total assets = Beginning total assets of $3,490 (from above) + Cash from issuance of common stock of $1,025 − Cash used to repay debt of $710