Packard Company engaged in the following transactions during Year 1, its first year of operations. (Assume all transactions are cash transactions.)1) Acquired $950 cash from the issue of common stock. 2) Borrowed $420 from a bank.
3) Earned $650 of revenues cash.
4) Paid expenses of $250.
5) Paid a $50 dividend.During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.)1) Issued an additional $325 of common stock.
2) Repaid $220 of its debt to the bank.
3) Earned revenues of $750 cash.
4) Paid expenses of $360.
5) Paid dividends of $100.
What is the amount of total assets that will be reported on Packard's balance sheet at the end of Year 2?
A) $2,115
B) $440
C) $2,215
D) $395

Question

Quizplus · Accepted Answer

Total assets at the end of Year 2 are $2,115. This is calculated by adding the beginning assets of $950 to the net income for Year 2 of $440. Net income is calculated by subtracting expenses of $360 from revenues of $750.

Packard Company Engaged in the Following Transactions During Year 1