Palm Textile Corporation had the following balance sheet accounts and balances: $\begin{array}{lrlr}
\text { Accounts Payable } & \$ 12,000 & \text { Common Stock } & ? \
\text { Accounts Receivable } & 2,000 & \text { Equipment } & \$ 14,000 \
\text { Building } & ? & \text { Land } & 14,000 \
\text { Cash } & 6,000 & \text { Retained Earnings } & 4,000
\end{array}$ If the balance of the Building account were $53,000,what would be the total of liabilities and stockholders' equity?
A) $53,000
B) $89,000
C) $83,000
D) $73,000

Question

Quizplus · Accepted Answer

The total assets are calculated as: Cash ($6,000) + Accounts Receivable ($2,000) + Equipment ($14,000) + Land ($14,000) + Building ($53,000) = $89,000. Liabilities and stockholders' equity must equal total assets, so they also total $89,000.

Palm Textile Corporation Had the Following Balance Sheet Accounts and Balances