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BProblemsChapter 1-1

# BProblemsChapter 1-1 - Problem 1-1 CHARLES COMPANY BALANCE...

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Unformatted text preview: Problem 1-1 CHARLES COMPANY BALANCE SHEET AS OF DECEMBER 31, ----. Assets Liabilities and Owners’ Equity Cash............................................................................................................................................................................ \$ 12,000 Bank loan................................................................................................. \$ 40,000 Inventory..................................................................................................................................................................... 95,000 Owners’ Equity Other assets................................................................................................................................................................. 13,000 Owners’ equity..................................................................................... 80,000 Total assets.................................................................................................................................................................. \$120,000 Total liabilities and owners’ equity......................................................................................... \$120,000 This problem can be used to explain certain accounting presentation conventions. For example, the use of double lines to underscore a total, the position of the dollar sign at the top of a column of numbers, and the dating of the balance sheet. The purpose of this problem is to illustrate the equality of the basic accounting equation: assets equal liabilities plus owners’ equity. Problem 1-2 The missing numbers are: Year 1 Noncurrent assets..................................................................................................................................................................... \$410,976 Noncurrent liabilities................................................................................................................................................................ 240,518 Year 2 Current assets........................................................................................................................................................................... \$ 90,442 Total assets............................................................................................................................................................................... 288,456 Noncurrent liabilities................................................................................................................................................................ 78,585 Year 3 Total assets............................................................................................................................................................................... \$247,135 Current liabilities.....................................................................................................................................................................Current liabilities....
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BProblemsChapter 1-1 - Problem 1-1 CHARLES COMPANY BALANCE...

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