Financial Accounting: An Integrated Statements Approach, 2nd Edition

a. Determine the stockholders’ equity of Walt Disney as of September 30, 2003.

b. If assets increased by $3,914 and stockholders’ equity increased by $2,290, what was the

increase or decrease in liabilities for the year ending September 30, 2004?

c. What were the total assets, liabilities, and stockholders’ equity as of September 30, 2004?

d. Based upon your answer to (c), does the accounting equation balance?

Campbell Soup Co.had the following assets and liabilities (in millions) as of August 3, 2003.

Assets $6,205

Liabilities 5,818

a. Determine the stockholders’ equity of Campbell Soup as of August 3, 2003.

b. If assets increased by $470 and liabilities decreased by $17, what was the increase or

decrease in stockholders’ equity for the year ending August 1, 2004?

c. What were the total assets, liabilities, and stockholders’ equity as of August 1, 2004?

d. Based upon your answer to (c), does the accounting equation balance?

One item is omitted in each of the following summaries of balance sheet and income statement

data (in millions) for General MotorsandCoca-Colaas of December 31, 2004 and 2003.

General Coca-

Motors Cola

December 31, 2003:

Assets $448,507 (e)

Liabilities (a) (f)

Stockholders’ equity (b) $14,090

Increase (Decrease) in assets, liabilities, and stockholders’ equity

during 2004:

Assets $ 31,096 (g)

Liabilities 28,638 $ 2,140

Stockholders’ equity 2,458 ( h)

December 31, 2004:

Assets (c ) $31,327

Liabilities $451,877 ( i )

Stockholders’ equity (d) 15,935

Determine the amounts of the missing items (a) through (i).

Chris Lund is the sole stockholder and operator of Saluki, a motivational consulting business.

At the end of its accounting period, December 31, 2005, Saluki has assets of $475,000 and liabili-

ties of $200,000. Using the accounting equation and considering each case independently, de-

termine the following amounts:

a. Stockholders’ equity, as of December 31, 2005.

b. Stockholders’ equity, as of December 31, 2006, assuming that assets increased by $75,000

and liabilities increased by $40,000 during 2006.

c. Stockholders’ equity, as of December 31, 2006, assuming that assets decreased by $15,000

and liabilities increased by $27,000 during 2006.

76 Chapter 2 Basic Accounting Concepts

Exercise 2-3

Accounting equation

Goal 1

a. $387

Exercise 2-4

Accounting equation

Goal 1

a. $423,239

Exercise 2-5

Accounting equation

Goal 1

b. $310,000