ating s, and of its total assets. BE1-3 At the beginning of the year, Gilles Company had total assets of $800,000 and total liabilities of $300,000. Answer the following questions. (a) If total assets increased $150,000 during the year and total liabilities decreased $60,000, what is the amount of owner's equity at the end of the year? (b) During the year, total liabilities increased $100,000 and owner's equity decreased $70,000. What is the amount of total assets at the end of the year? (c) If total assets decreased $80,000 and owner's equity increased $120,000 during the year, what is the amount of total liabilities at the end of the year? BE1-4 Use the expanded accounting equation to answer each of the following questions. (a) The liabilities of Kafka Company are $90,000. Owner's capital is $150,000; drawings are $40,000; revenues, $450,000; and expenses, $320,000. What is the amount of Kafka Company's total assets? (b) The total assets of Rivera Company are $57,000. Owner's capital is $25,000; drawings are $7,000; revenues, $52,000; and expenses, $35,000. What is the amount of the com- pany's total liabilities? (c) The total assets of Alcorn Co. are $600,000 and its liabilities are equal to two-thirds of its total assets. What is the amount of Alcorn Co.'s owner's equity? BE1-5 Indicate whether each of the following items is an asset (A), liability (L), or part of owner's equity (OE). (a) Accounts receivable (b) Salaries and wages payable (c) Equipment (d) Supplies (e) Owner's capital (f) Notes payable BE1-6 Presented below are three business transactions. On a sheet of paper, list the letters (a), (b), and (c) with columns for assets, liabilities, and owner's equity. For each column, indicate whether the transactions increased (+), decreased (-), or had no effect (NE) on assets, liabilities, and owner's equity. (a) Purchased supplies on account. (b) Received cash for performing a service. (c) Paid expenses in cash. BE1-7 Follow the same format as in BE1-6. Determine the effect on assets, liabilities, and owner's equity of the following three transactions. (a) Invested cash in the business. (b) Withdrawal of cash by owner. (c) Received cash from a customer who had previously been billed for services performed. BE1-8 Classify each of the following items as owner's drawings (D), revenue (R), om expense (E).