C&R Lumber started the year with total assets of $300,000 and total liabilities of $180,000

1. C&R Lumber started the year with total assets of $300,000 and total liabilities of $180,000. During the year, the business recorded $375,000 in revenues, $240,000 in expenses, and dividends of $50,000. Stockholders' equity at the end of the year was

$205,000

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Stockholders' equity = ($300,000 - $180,000) + ($375,000 - $240,000) - $50,000.

SE = (Total Assets - Total Liabilities) + (Revenues - Expenses) - Dividends

2. Smith Corporation began the year with retained earnings of $300,000. During the year, the company issued $500,000 of common stock, recorded expenses of $2,000,000, and paid dividends of $200,000. If Smith's ending retained earnings was $425,000, what was the company's revenue for the year?

$2,325,000

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$425,000 + $200,000 + $2,000,000 - $300,000 = $2,325,000

NEW Retained Earnings + Paid Dividends + Expenses - OLD Retained Earnings = Revenue

3. Paulson Company began the year with retained earnings of $500,000. During the year, the company issued $720,000 of common stock, recorded expenses of $2,000,000, and paid dividends of $80,000. If Paulson's ending retained earnings was $520,000, what was the company's revenue for the year?

$2,100,000

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$520,000 + $80,000 + $2,000,000 - $500,000 = $2,100,000

NEW Retained Earnings + Paid Dividends + Expenses - OLD Retained Earnings = Revenue

4. A company purchases new manufacturing equipment using a loan from the bank. They plan to re-pay the loan over the next 10 years. The loan is an example of

a liability

5. A company has assets of $46,000 and stockholders' equity of $5,000. According to the basic accounting equation, its total liabilities are

$41,000

6. To determine the retained earnings at the end of the period, the company

adds net income and deducts dividends.

7. Investors would be MOST interested in using the ________ to determine the company's policy toward dividends and growth.

retained earnings statement

8. A brick company calculated its stockholders' equity for the fiscal year 2017. Its overall revenues were $3.8 million, expenses were $2.4 million, and dividends paid were $500,000. The company experienced a net _________ of

income; $1.4 million.

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Net income or loss is measured by subtracting expenses from revenues. Dividends are not considered in calculating a net income or loss. $3.8 million - $2.4 million = $1.4 million income

9. Kramer Fabrications stockholders' equity at the beginning of July 2017 was $600,000. During the month, the company earned net income of $145,000 and paid dividends of $25,000. At the end of July 2017, what is the amount of stockholders' equity?

$720,000

10. Taylor Company compiled the following financial information as of December 31, 2017.
    
    Service revenue: $625,000
    Common stock: $150,000
    Equipment: $100,000
    Operating expenses: $400,000
    Cash: $100,000
    Dividends: $30,000
    Supplies: $25,000
    Accounts payable: $75,000
    Accounts receivable: $95,000
    Retained earnings, 1/1/17: $375,000
    
    Taylor's retained earnings on December 31, 2017, are which of the following?

$570,000

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$375,000 + ($625,000-$400,000) - $30,000 = $570,000

OLD Retained Earnings + (Service Revenue - Operating Expenses) - Dividends = NEW Retained Earnings