[ina93]

Calculate the amount of liabilities for Company E on December 31, 2010
INFORMATION PROVIDED:
DEC 31 2010
ASSETS 95,000
LIABILITIES ?
DEC 31 2011
ASSETS 104,880
LIABILITIES 82,855
OWNER INVE 6,500
NET INCOME 7,415
WITHDRAWALS11,000

[pready]

First thing you need to do is calculate Owners Equity at Dec 31, 2011. The formula is Assets(amount is given) - Liabilities(amount is given) = Owners Equity.

Now take your Owners Equity and subtract out your owners investment during the year, subtract out your net income during the year, and add your cash dividends during the year to get your Owners Equity at Dec 31, 2010.

Now that you have Assets and Owners Equity at Dec 31, 2010 you can solve for Liabilities at Dec 31, 2010. The formula is Assets - Owners Equity = Liabilities.