At the beginning of 20B,Rodriguez Corporation had assets of $820,000 and liabilities of $340,000.During the year,assets increased by $40,000 and liabilities decreased by $8,000.What was the total amount of shareholders' equity at the end of 20B?

Question

Quizplus · Accepted Answer

Shareholders' equity can be calculated as follows:

Shareholders' equity = Assets - Liabilities

At the beginning of the year, shareholders' equity was:

$820,000 - $340,000 = $480,000

During the year, assets increased by $40,000 and liabilities decreased by $8,000. Therefore, at the end of the year:

Assets = $820,000 + $40,000 = $860,000 
Liabilities = $340,000 - $8,000 = $332,000

Shareholders' equity = $860,000 - $332,000 = $528,000

Therefore, the correct answer is (C) $528,000.

At the Beginning of 20B,Rodriguez Corporation Had Assets of $820,000