Balance sheets

USA Discussion in 'Exams and Studying' started by xxkarezxx, Nov 14, 2016.

  1. xxkarezxx

    xxkarezxx

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    I'm new to accounting so I'm not entirely sure if I'm doing the right thing. So, can you guys help me figure out what I did wrong? (I'm afraid all of it are)

    so, here's my work, but I can't seem to balance the Total assets and total liabilities&equity.
    [​IMG]

    and this is the problem given

    [​IMG]
     
    xxkarezxx, Nov 14, 2016
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  2. xxkarezxx

    Fidget VIP Member

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    The accumulated retained earnings figure is a balancing figure, since the question doesn't tell you what it is, and you can only work out the retained earnings for the year from the information given.

    You've missed out retained earnings relating to prior years (ie the balancing figure), and that's why you can't get it to balance.

    So, we know that total assets = 546, and we know that total liabilities are 425. Equity must therefore be 121. From the equity related figures in the question, we can see that equity is Common Stock - treasury stock (1000 - 25000) = -24000, so therefore, the retained earnings figure (including the current year) must be 145, so that 1000+14500-25000 = 121000. And 425,000 + 121,000 = 546,000.

    Does that help?

    Your layout isn't a proper balance sheet layout either - you've got P&L stuff in there, but that's easy to remedy.
     
    Last edited: Nov 19, 2016
    Fidget, Nov 19, 2016
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