Savvy Sightseeing had beginning equity of $72,000; revenues of $90,000, expenses of $65,000, and dividends to stockholders of $9,000. There were no stockholder investments during the year. Calculate ending equity.
A. $25,000.
B. $47,000.
C. $88,000.
D. $97,000.
E. $38,000.
Answer: C
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Singer and McMann are partners in a business. Singer's original capital was $40,000 and McMann's was $60,000 . They agree to salaries of $12,000 and $18,000 for Singer and McMann, respectively, and 10% interest on original capital. If they agree to share remaining profits and losses on a 3:2 ratio, what will McMann's share of the income be if the income for the year is $15,000?
a. $6,000 b. $9,400 c. $12,600 d. $14,000
If the auditor wants to obtain evidence as to whether the dividend payment was made to the stockholders who owned the stock as of the dividend record date, which of the following would the auditor do?
a. Recalculate the dividends per share. b. Examine the minutes of the board of directors meetings for authorization. c. Trace the payee's name on the canceled check to the dividend records. d. Determine that dividend restrictions are adequately disclosed in the financial statements.
Which of the following is the correct accounting treatment for a patent?
A) A patent must be shown as a current asset on the balance sheet. B) A patent must be depreciated or impaired, but not amortized. C) A patent must be capitalized and amortized over 20 years or less. D) A patent must be expensed, not capitalized, in the period in which it is purchased.
Which of the following questions considered by marketers is best aligned with distribution strategies?
a. Which market segment should we target? b. How do we convince customers to buy our products? c. What products should we manufacture? d. Where do customers like to shop?