On January 1, 2009, total assets for Liftoff Technologies were $125,000; on December 31, 2009, total assets were $145,000. On January 1, 2009, total liabilities were $110,000; on December 31, 2009, total liabilities were $115,000. What is the amount of the change and the direction of the change in Liftoff Technologies' stockholders' equity for 2009?

Question

Quizplus · Accepted Answer

The change in stockholders' equity is calculated by finding the change in assets minus the change in liabilities. The assets increased by $20,000 ($145,000 - $125,000), and the liabilities increased by $5,000 ($115,000 - $110,000). Therefore, the stockholders' equity increased by $15,000 ($20,000 - $5,000).

On January 1, 2009, Total Assets for Liftoff Technologies Were