1. Ex At the beginning of the year, Yates Company had total assets of $1,050,000 and total liabilities of $600,000. Answer the following questions viewing each situation as being independent of the others. (1) If total assets increased $350,000 during the year, and total liabilities decreased $150,000, what is the amount of owner's equity at the end of the year? (2) During the year, total liabilities increased $500,000 and owner's equity decreased $200,000. What is the amount of total assets at the end of the year? (3) If total assets decreased $90,000 and owner's equity increased $280,000 during the year, what is the amount of total liabilities at the end of the year?  

2. Solution 126. (5 min. ). Total Assets. Total Liabilities
Solution 126 (5 min.) Total Assets Total Liabilities Owner's Equity Beginning $1,050,000 $600,000 Change ,000 (150,000) Ending $1,400,000 – $450,000 = $950,000 (1)   Total Assets Total Liabilities Owner's Equity Beginning $1,050,000 $ 600,000 $450,000 Change ,000 (200,000) Ending $1,350,000 (2) = $1,100,000 + $250,000 Total Assets Total Liabilities Owner's Equity Beginning $1,050,000 $600,000 $450,000 Change (90,000) ,000 Ending $ 960,000 = $230,000 (3) + $730,000    

3. Ex. 139
Prepare an income statement, an owner's equity statement, and a balance sheet for the dental practice of Carl Craft, DDS, from the items listed below for the month of September.
Carl Craft, Capital, September 1 $40,000
Accounts payable 7,000
Equipment 30,000
Service revenue 24,000
Carl Craft, Drawings 5,000
Dental supplies expense 3,500
Cash 6,000
Utilities expense 700
Dental supplies 2,800
Salaries expense 7,000
Accounts receivable 14,000
Rent expense 2,000
CARL CRAFT, DDS
Income Statement and Statement of owners equity and Balance Sheet
For the Month Ended September 30, 2002

4. CARL CRAFT, DDS
Income Statement
For the Month Ended September 30, 2002
Revenues
Service revenue $24,000
Expenses
Salaries expense $7,000
Dental supplies expense 3,500
Rent expense 2,000
Utilities expense
Total expenses ,200
Net income $10,800

5. CARL CRAFT, DDS
Owner's Equity Statement
For the Month Ended September 30, 2002
Carl Craft, Capital, September 1 $40,000
Add: Net income ,800
50,800
Less: Drawings ,000
Carl Craft, Capital, September 30 $45,800

6. CARL CRAFT, DDS
Balance Sheet
September 30, 2002
Assets
Cash $ 6,000
Accounts receivable 14,000
Dental supplies 2,800
Equipment ,000
Total assets $52,800
Liabilities and Owner's Equity
Liabilities
Accounts payable $ 7,000
Owner's Equity
Carl Craft, Capital ,800
Total liabilities and owner's equity $52,800