Accounting equation shannon cook is the stockholder and operator of personality shine llc, a motivational consulting business. at the end of its accounting period, december 31, 2017, personality shine has assets of $836,000 and liabilities of $201,000. using the accounting equation, determine the following amounts: a. stockholders' equity as of december 31, 2017? b. b. stockholders' equity as of december 31, 2018, assuming that assets decreased by $159,000 and liabilities decreased by $48,000 during 2018

a. Stockholders' equity as of December 31, 2017: $635,000

b. Stockholders' equity as of December 31, 2018: $524,000

Explanation:

Please find the below for detailed explanation and calculations:

We have the Accounting Equation as: Total Asset = Total Liabilities + Total Equity <=> Total Equity = Total Asset - Total Liabilities

Applying the Accounting Equation to find the Stockholder's Equity at the two point of time require, we have the calculation as below:

* December 31, 2017:

Total Asset = $836,000; Total Liabilities = $201,000

=> Total Stockholder's Equity = $836,000 - $201,000 =$635,000

*December 2018:

Total Asset = $836,000 - $159,000 = $677,000; Total Liabilities = $201,000 - $48,000 = $153,000

=> Total Stockholder's equity = $677,000 - $153,000 = $524,000

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