Question

Assets, Beginning of Period 12,000


Liabilities, Beginning of Period 5,000


Assets, End of Period 23,000


Liabilities, End of Period 9,000


Investment by Owner 10,000


Revenues 99,000


Withdrawals by Owner 0


Solve for the expenses incurred during the period.

Answer 1

Costs (costs, expenses) are a decrease in assets or an increase in liabilities (liabilities) or a combination of both in connection with the production and delivery of goods and services in the framework of the enterprise. The expenses associated with the implementation of capital and financial investments do not relate to the expenses of the enterprise.

Therefore, we calculate the expenses:

Expenses = (Assets, End of Period - Assets, Beginning of Period) +(Liabilities End of Period - Liabilities, Beginning of Period)=(23000-12000)+(9000-5000)=11000+4000=15000