Exercise - Accounting Equation
Todd Olson is the sole stockholder and operator of Alpha, a motivational consulting business. At the end of its accounting period, December 31, 2011, Alpha has assets of $580,580 and liabilities of $183,460. Using the accounting equation and considering each case independently, determine the following amounts.
a. Stockholders' equity as of December 31, 2011.
b. Stockholders' equity as of December 31, 2012, assuming that assets increased by $91,730 and liabilities increased by $55,160 during 2012.
c. Stockholders' equity as of December 31, 2012, assuming that assets decreased by $45,870 and liabilities increased by $16,260 during 2012.
d. Stockholders' equity as of December 31, 2012, assuming that assets increased by $76,640 and liabilities decreased by $29,030 during 2012.
e. Net income (or net loss) during 2012, assuming that as of December 31, 2012, assets were $731,530, liabilities were $119,020, and no additional capital stock was issued or dividends paid.