PE 4-2A Statement of owner’s equity

Judy Flint owns and operates Derby Advertising Services. On January 1, 2011, Judy Flint,
Capital had a balance of $290,000. During the year, Judy invested an additional $100,000
and withdrew $40,000. For the year ended December 31, 2011, Derby Advertising Services
reported a net income of $93,750. Prepare a statement of owner’s equity for the
year ended December 31, 2011.

Answer:

Derby Advertising Services 

Statement of Owner’s Equity 

For the Year Ended December 31, 2011 

Judy Flint, capital, January 1, 2011 ..............$290,000
Additional investment during 2011..................100,000
 Total ............................................................................ $390,000
Net income............................................. $ 93,750
Less withdrawals ........................................40,000
Increase in owner’s equity .................................................. 53,750
Judy Flint, capital, December 31, 2011...............................        $443,750