Question

If total liabilities decreased by $42,000 during a period of time and stockholders' equity increased by $18,000 during the same period, then the amount and direction (increase or decrease) of the period's change in total assets is a(n) _________.

Answer 1

-$24,000

Step-by-step explanation:

Data provided as per the question

Total liabilities decreased = $42,000

Stockholders' equity increased = $18,000

The computation of change in total assets is shown below:-

Assets = Liabilities + Shareholder equity

Change in total assets = Change in liabilities + Change in shareholder equity

= -$42,000 + $18,000

= -$24,000