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  • Dec 11, 2011, 11:43 AM
    shanapollack15
    Accounting question
    At the beginning of the year, Morgan Company had total assets of $450,000 and total liabilities of $280,000.

    If, during the year, total assets decreased by $65,000 and total stockholders' equity increased by $45,000, what is the amount of total liabilities at the end of the year?

    How do I answer this?
  • Dec 11, 2011, 03:32 PM
    pready
    First you need to find beginning Owners Equity:
    Assets = Liabilities + Owners Equity or Owners Equity = Assets - LIabilities

    Now just decrease your assets and increase your Owners Equity by the amounts given, then solve for Liabilities.
    Liabilities = Assets - Owners Equity

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