Accounts 111 Unit 1 Question 1 Solution 50/50 Marks

1. Award: 10 out of 10.00 points

Using the following table and the equations underlying each of the four basic financial statements, show (a)

that the balance sheet is in balance, (b) that net income is properly calculated, (c) what caused changes in

the retained earnings account, and (d) what caused changes in the cash account. (Cash outflows should

be indicated with a minus sign.)

Assets $18,900

Liabilities 14,100

Stockholders’ Equity 4,800

Revenue 11,200

Expenses 9,550

Net Income 1,650

Dividends 850

Beginning Retained Earnings 4,200

Ending Retained Earnings 5,000

Cash Flows from Operating Activities 2,300

Cash Flows from Investing Activities (1,700 )

Cash Flows from Financing Activities (1,250 )

Beginning Cash 1,700

Ending Cash 1,050