Mofro's Computer Repair Shop Started the Year with Total Assets

question 185

Multiple Choice

Mofro's Computer Repair Shop started the year with total assets of $300,000 and total liabilities of $200,000. During the year, the business recorded $500,000 in computer repair revenues, $300,000 in expenses, and Mofro paid dividends of $50,000. Mofro's stockholders' equity changed by what amount from the beginning of the year to the end of the year?

• A) $100,000.
• B) $150,000.
• C) $200,000.
• D) $250,000.

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Definitions:

Consignment

An arrangement in which goods are left with a third party to sell, but the ownership remains with the supplier until the goods are sold.

Warranty Repairs

Warranty repairs are services provided to fix defects in products that are under warranty without additional charge to the consumer. These costs are often anticipated and accounted for by the manufacturer.

Physical Count

A process of manually counting actual inventory to verify quantities and ensure accuracy of records.

Lower Of Cost

An accounting principle that valuates inventory at the lower amount between its original cost and current market value.