Suppose a company has no transactions with its owners during 20X0. That is, paid-in capital remains unchanged,

Question:

Suppose a company has no transactions with its owners during 20X0. That is, paid-in capital remains unchanged, and retained earnings increases by the entire amount of the net income. During 20X0 the company’s net income is $50,000. At the beginning of the year, the company’s equation was as follows:
assets = liabilities + stockholders’ equity
$450,000 = $200,000 + $250,000

What do you know about the equation at the end of 20X0?

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...