Question

VI. Answer the following questions by applying the Accounting Equation.

1. The assets of Zealand Company amount to P 950,000, and the owner's equity of P 560,000. What is the amount of liabilities?

2. The liabilities and owner's equity of Greenland Company amount to P 5,980,000 and P 3,200,000 respectively. How much is the company's assets?

3. Luigi Company has owner's equity of P 7,940,000 and total assets of P 10,670,000. How much is the creditor's equity?

4. The liabilities of Spicy Company are equal to one-third of the total assets. The owner's equity is P 2,400,000. What is the amount of liabilities?

5. At the beginning of the year, Sweet Company's assets amount to P 11,000,000 and owner's equity amounting to P 5,000,000. During this year, assets increased by P 3,000,000, while liabilities decreased by P 500,000. How much is the owner's equity at the end of the year?

6. Mel Jayson is the owner of MJ Laundry. At the end of its accounting period, December 31, 2020, the business has total assets of P 4,162,500 and liabilities of P 1,710,000 How much is Mel Jayson, Capital as of December 31, 2020?

7. At the beginning of the year 2020, Smart Company has total assets of P 3,560,000 and total liabilities of P 980,000. During the year 2020, assets decreased by P 600,000 while liabilities increased by P 850,000. How much is the owner's equity at December 31, 2020?

8. At the end of the year 2020, PLDT company has total assets of P 5,450,000 and total liabilities of P 1,980,000. During the year 2020, assets increased by P 750,000 while liabilities increased by P 300,000. What is the amount of Capital at the beginning of 2020?​

Answer 1

By applying the accounting equation, the calculated values for liabilities, assets, creditor's equity, and owner's equity are provided for each given scenario.

Step-by-step explanation:

The accounting equation is Assets = Liabilities + Owner's Equity. By applying this equation to the given information:

1. The liabilities of Zealand Company can be calculated as P 950,000 - P 560,000 = P 390,000.
2. The assets of Greenland Company can be calculated as P 5,980,000 + P 3,200,000 = P 9,180,000.
3. The creditor's equity of Luigi Company can be calculated as P 10,670,000 - P 7,940,000 = P 2,730,000.
4. The liabilities of Spicy Company can be calculated as P 2,400,000 x 3 = P 7,200,000.
5. The owner's equity of Sweet Company at the end of the year can be calculated as P 11,000,000 + P 3,000,000 - P 500,000 - P 5,000,000 = P 8,500,000.
6. The capital of MJ Laundry (Mel Jayson) as of December 31, 2020, can be calculated as P 4,162,500 - P 1,710,000 = P 2,452,500.
7. The owner's equity of Smart Company at December 31, 2020, can be calculated as P 3,560,000 - P 980,000 + P 850,000 - P 600,000 = P 2,830,000.
8. The capital of PLDT company at the beginning of 2020 can be calculated as P 5,450,000 - P 750,000 + P 300,000 - P 1,980,000 = P 3,020,000.