(Beg. R/E + (ser. rev. – oper. exp.) – div.)
155. Elston Company compiled the following financial information as of December 31, 2022:
Service revenue $840,000
Common stock 180,000
Equipment 240,000
Operating expenses 750,000
Cash 210,000
Dividends 60,000
Supplies 30,000
Accounts payable 120,000
Accounts receivable 300,000
Retained earnings, 1/1/22 450,000
Elston’s stockholders’ equity on December 31, 2022 is
a. $630,000.
b. $660,000.
c. $480,000.
d. $720,000.
Ans: B, LO: 3, Bloom: AP, Difficulty: Medium, Min: 3, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: Problem Solving, IMA: Reporting
Solution: $180,000 + [$450,000 + ($840,000 - $750,000) - $60,000] = $660,000
(Com. st. + beg. R/E + (ser. rev. – oper. exp.) – div.)
156. Benedict Company compiled the following financial information as of December 31, 2022:
Service revenue $1,120,000
Common stock 240,000
Equipment 320,000
Operating expenses 1,000,000
Cash 280,000
Dividends 80,000
Supplies 40,000
Accounts payable 160,000
Accounts receivable 400,000
Retained earnings, 1/1/22 600,000
Benedict’s assets on December 31, 2022 are
a. $2,160,000.
b. $1,640,000.
c. $1,000,000.
d. $1,040,000.
Ans: D, LO: 3, Bloom: AP, Difficulty: Medium, Min: 3, AACSB: Analytic, AICPA BB: Legal/Regulatory Perspective, AICPA FC: Reporting, AICPA PC: Problem Solving, IMA: Reporting
Solution: $320,000 + $280,000 + $40,000 + $400,000 = $1,040,000
(Equip. + cash + sup. + A/R)
157. Benedict Company compiled the following financial information as of December 31, 2022:
Service revenue $1,120,000
Common stock 240,000