At the Beginning of the Year,Execon Company Had Total Assets

question 48

Multiple Choice

At the beginning of the year,Execon Company had total assets of $200,000,total liabilities of $110,000,and shareholders' equity of $90,000.For the year,Execon Company earned net income of $75,000 and declared cash dividends of $30,000.At the end of the year,the company had total assets of $300,000 and its shareholders' equity was at $135,000.At the end of the year,Execon Corporation had total liabilities of:

• A)$0.
• B)$45,000.
• C)$50,000.
• D)$165,000.
• E)None of the answers are correct.

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Definitions:

Economic Models

Simplified frameworks used to describe the workings of the economy and to analyze economic variables and their relationships.

Trickle-up Theory

A theory suggesting that trends and innovations are initiated from the lower social classes and then adopted by the upper classes.

Trickle-down Theories

Theories suggesting that trends, behaviors, or innovations initiated by higher socioeconomic groups gradually spread to lower socioeconomic groups.

Trickle-down Theory

An economic hypothesis that argues benefits for the wealthy will "trickle down" to everyone else, improving the economy as a whole.