The Following Information Comes from the Records of Morton Corporation

question 37

Essay

The following information comes from the records of Morton Corporation.Assume no additional investment by owners when answering the following questions:
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$\begin{array}{llll} & \text { Assets } & \text { Liabilities } & \text { Owners' Equity } \\\text { January } 1,2017 & \$ 98,000 & \$ 54,000 & \$ \\\text { December } 31,2017 & 131,000 & & 84,000\end{array}$ A) What is the amount of owners' equity at January 1,2017 ?________

B) What is the amount of liabilities at December 31,2017 ?_____________

C) Assume that the company declared and paid dividends of $\$ 22,000$ during the year. How much net income did it earn during the year?

D) Assume that the company paid no dividends during the year. Without looking at the income statement, how can you tell if the company is profitable or not?

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Definitions:

Inference

The process of drawing conclusions about a population based on data from a sample.

Statistical Inference

The process of using data analysis to deduce properties of an underlying probability distribution.

Estimate

An approximation or educated guess of a certain quantity based on available data.

Population

The entire group or set of items or individuals from which samples may be drawn for statistical analysis.