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Examination 1

Bookkeeping and accounting are related but different processes. Bookkeeping involves recording economic transactions, while accounting is a broader process that includes identifying, recording, and communicating those transactions. The document also provides examples of accounting calculations, including: - Calculating net income from changes in capital balance - Computing owner's equity, assets, and liabilities from financial balances - Determining unknown financial values like liabilities or owner's equity from other known values

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185 views2 pages

Examination 1

Bookkeeping and accounting are related but different processes. Bookkeeping involves recording economic transactions, while accounting is a broader process that includes identifying, recording, and communicating those transactions. The document also provides examples of accounting calculations, including: - Calculating net income from changes in capital balance - Computing owner's equity, assets, and liabilities from financial balances - Determining unknown financial values like liabilities or owner's equity from other known values

Uploaded by

trinh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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1. “Bookkeeping and accounting are the same.” Do you agree? Explain.

=> Disagree.
The accounting process includes the bookkeeping function. Bookkeeping usually involves
only the recordings of economic events. It is therefore just one part of the accounting process.
In total, accounting involves that entire process of identifying, recording, and communicating
economic events

2. Saylor Enterprises had a capital balance of $168,000 at the beginning of the period. At
the end of the accounting period, the capital balance was $198,000.
(a) Assuming no additional investment or withdrawals during the period, what is the net
income for the period?
=> The net income for the period = $198,000 – $168,000 = $30,000
(b) Assuming an additional investment of $13,000 but no withdrawals during the period,
what is the net income for the period?
=> The net income for the period = $198,000 – $168,000 - $13,000 = $17,000
3.
a. Owner’s Equity = Assets – Liabilities
= $90,000- $50,000
= $40,000
b. Assets = Liabilities + Owner’s Equity
= $44,000 + $70,000
= $ 114,000
c. Liabilities = Assets – Owner’s Equity
= $94,000 - $53,000
= $41,000
4.
a, Liabilities = $90,000
Owner’s Capital= $150,000
Drawings= $40,000
Revenues = $320,000
Expenses= $320,000
 Total assets= $90,000 + $150,000 + $320,000 - $320,000 - $40,000 = $200,000
b, Total assets= $57,000
Owner’s Capital= $25,000
Drawings= $7,000
Revenues = $52,000
Expenses= $35,000
 Total liabilities = Assets – owner’s capital – revenues +expenses + drawings
= $57,000 - $25,000 - $52,000 + $35,000 + $7,000
= $22,000
c, Total assets= $600,000
Liabilities are equal to two – thirds of total assets =>New Liabilities = $400,000
 Owner’s Equity = $200,000

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