Question

The​ stockholders' equity of Gorsky Company at the beginning and end of 2018 totaled $ 125,000 and $ 131,000​, respectively. Assets at the beginning of 2018 were $ 145,000. If the liabilities of Gorsky Company increased by $ 71,000 in 2018​, how much were total assets at the end of 2018​? Use the accounting equation.

Answer 1

The assets at the end of 2018 will be for 222,000

Step-by-step explanation:

We solve using the accounting equation:

Assets = Liabilities + Equity

2017

Equity 125,000

Assets 145,000

Assets = Liabilities + Equity

145,000 = Liabilities + 125,000

145,000 - 125,000 = Liabilities

Liaiblities = 20,000

2018

Equity 131,000

"Liabilities increase by 71,000"

Liabilities = 2017 + increase = 20,000 + 71,000 = 91,000

Assets = Liabilities + Equity

Assets = 91,000 + 131,000 = 222,000