Question

Cougar’s Accounting Services provides low-cost tax advice and preparation to those with financial need. At the end of thecurrent period, the company reports the following amounts: Assets = 517,000; Liabilities = 514.000: Revenues = $26,000:Expenses = 532,000.Required.-1‘ Calculate net loss.2 Calculate stockholders’ equity at the end of the period.

Answer 1

1. $506,000

2. $3,000

Step-by-step explanation:

The computation is shown below:

Net loss = Expenses - revenue

= $532,000 - $26,000

= $506,000

And, we know that

Total assets = Total liabilities + owners equity

$517,000 = $514,000 + owners equity

So, the owners equity is

= $517,000 - $514,000

= $3,000

Simply we applied the above formula and the above accounting equation so that the accurate amount could come