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    Need help with a problem: accounting transactions; assets, liabilities and stockholders' equity.?

    A vacant lot acquired for $150,000, on which there is a balance owed of $80,000, is sold for $290,000 in cash. The seller pays the $80,000 owed. What is the effect of these transactions on the total amount of the seller’s (1) assets, (2) liabilities, and (3) stockholders’ equity?
    a few seconds ago 1 Answer

    Best Answer

    The easiest way to see it is to make a journal entry. Dr Cash 290,000 Dr Mortgage Payable 80,000 Cr Land 150,000 Cr Gain on Sale of Land 220,000 Assets were increased by 140,000 (290,000 - 150,000) Liabilities were decreased by 80,000 Stockholders' Equity was increased by 220,000
    a few seconds ago

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