14/07/2021
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Example of Capital Increases
Accounting / / July 04, 2021
1. Capital increases when only Assets increase.
| Concept | Initial | Final | Differences | Sign |
| Total Assets | $300 000 | $350 000 | $50 000 | + Active |
| Total Liabilities | $100 000 | $100 000 | ||
| Stockholders' equity | $200 000 | $250 000 | $50 000 | + Capital |
Verification:
Asset Increase = Capital Increase. $ 50 000.00 = $ 50 000.00
2. Capital increases when only Liabilities decrease.
| Concept | Initial | Final | Differences | Sign |
| Total Assets | $300 000 00 | $300 000 00 | ||
| Total Liabilities | $100 000 00 | $50 000 00 | $50 000 00 | - Passive |
| Stockholders' Equity | $200 000 00 | $250 000 00 | $50 000 00 | + Capital |
Verification:
Decrease in Liabilities = Increase in Capital. $ 50 000.00 = $ 50 000.00
3. Capital increases when Assets increase and Liabilities decrease.
| Initial | Final | Differences | Sign |
| $ 300 000 00 | $ 350 000 00 | $ 50 000 00 | + Active |
| $ 100 000 00 | $ 50 000 00 | $ 50 000 00 | - Passive |
| $ 200 000 00 | $ 300 000 00 | $ 100 000 00 | + Capital |
Verification:
Increase in Assets + decrease in Liabilities = Capital increase $ 50,000.00 + $ 50,000.00 = $ 100,000.00
4. Capital increases when Assets increase in greater proportion than Liabilities.
5. Capital increases when Liabilities decrease in a greater proportion than Assets.
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