Answer the following questions. Hint: Use the accounting equation. a. On January 1, Lumia Company's liabilities...

Transcribed Image Text:

Answer the following questions. Hint: Use the accounting equation. a. On January 1, Lumia Company's liabilities are $68,000 and its equity is $48,000. On January 3, Lumia purchases and installs solar panel assets costing $18,000. For the panels, Lumia pays $8,000 cash and promises to pay the remainder of $10,000 in six months. What is the total of Lumia's assets after the solar panel purchase? (5 points) b. On March 1, ABX Company's assets are $108,000 and its liabilities are $38,000. On March 5, ABX is fined $19,000 for failing emission standards. ABX immediately pays the fine in cash. After the fine is paid, what is the amount of equity for ABX? (5 points) c. On August 1, Lola Company's assets are $38,000 and its liabilities are $18,000. On August 4, Lola issues a sustainability report. Investors react positively to this report. On August 5, a new investor contributes $7,000 cash and $11,000 in equipment in exchange for Lola stock. After the investment, what is the amount of equity for Lola? (5 points) Answer the following questions. Hint: Use the accounting equation. a. On January 1, Lumia Company's liabilities are $68,000 and its equity is $48,000. On January 3, Lumia purchases and installs solar panel assets costing $18,000. For the panels, Lumia pays $8,000 cash and promises to pay the remainder of $10,000 in six months. What is the total of Lumia's assets after the solar panel purchase? (5 points) b. On March 1, ABX Company's assets are $108,000 and its liabilities are $38,000. On March 5, ABX is fined $19,000 for failing emission standards. ABX immediately pays the fine in cash. After the fine is paid, what is the amount of equity for ABX? (5 points) c. On August 1, Lola Company's assets are $38,000 and its liabilities are $18,000. On August 4, Lola issues a sustainability report. Investors react positively to this report. On August 5, a new investor contributes $7,000 cash and $11,000 in equipment in exchange for Lola stock. After the investment, what is the amount of equity for Lola? (5 points)

Answer rating: 100% (QA)

ACCOUNTING EQUATION It represents the relationship between the Assets Liabilities and Owners equit... View the full answer