Reference no: EM132826467
Problem 1: Tarr, a sole proprietorship, had the following balances and transactions during 2017: beginning capital, $40,000; contribution of cash to the business by the owner, $15,000; revenue, $60,000; expenses, $35,000; withdrawal by the owner, $5,000. What is the amount of the ending capital balance?
a. $75,000
b. $60,000
c. $85,000
d. $40,000
Problem 2: When a company declares a 2-for-1 stock split,
a. a shareholder who previously held 100 shares will have 300 shares after the split.
b. there is no effect on total stockholders' equity.
c. stockholders' equity is doubled.
d. the price of each share will be one-third of what it was before the stock split.
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