todd olson is the owner and operator of alpha a motivational consulting business 551128

EX 1-7 Accounting equation

Todd Olson is the owner and operator of Alpha, a motivational consulting business. At the end of its accounting period, December 31, 2011, Alpha has assets of $800,000 and liabilities of $350,000. Using the accounting equation and considering each case independently, determine the following amounts:

a. Todd Olson, capital, as of December 31, 2011.

b. Todd Olson, capital, as of December 31, 2012, assuming that assets increased by $150,000 and liabilities increased by $70,000 during 2012.

c. Todd Olson, capital, as of December 31, 2012, assuming that assets decreased by $60,000 and liabilities increased by $20,000 during 2012.

d. Todd Olson, capital, as of December 31, 2012, assuming that assets increased by $100,000 and liabilities decreased by $40,000 during 2012.

e. Net income (or net loss) during 2012, assuming that as of December 31, 2012, assets were $975,000, liabilities were $400,000, and there were no additional investments or withdrawals.