On January 1, 2019, Little Robot invested $300,000 to start Bot Corporation. During the year, Bot Corporation had total revenues of $60,000 and total expenses of $16,000. Cash dividends paid totaled $12,000.
What must have been the balance in Bot Corporation's total assets at the end of the year, assuming no liabilities?

Question

Quizplus · Accepted Answer

Ending retained earnings = Beginning retained earnings - Dividends + Net income
X = ($0 - $12,000 + ($60,000 - $16,000))
X = $32,000
Assets = Liabilities + Retained earnings + Contributed capital
Y = $0 + $32,000 + $300,000
Y = $332,000

On January 1, 2019, Little Robot Invested $300,000 to Start