Capital had a balance of $600,000. During the year, Mavis made no additional investments
and withdrew $45,000. For the year ended December 31, 2011, A2Z Delivery Services
reported a net loss of $13,500. Prepare a statement of owner’s equity for the year ended
December 31, 2011.
Answer:
A2Z Delivery Services
Statement of Owner’s Equity
For the Year Ended December 31, 2011
Mavis Curry, capital, January 1, 2011................................. $600,000Net loss...............................................$13,500
Add withdrawals.........................................45,000
Decrease in owner’s equity............................................ 58,500
Mavis Curry, capital, December 31, 2011 ........................... $541,500
Hie,
ReplyDeleteAccording to kotler/Armstrong 12th edition page 154, "if the owners withdrawals had exceeded the net income and the withdrawals would have been reversed. The difference in the two items would then be deducted from the beginning capital balance. "
I am not sure but I think your answer is wrong.
A2Z Delivery Services
Statement of Owner’s Equity
For the Year Ended December 31, 2011
Mavis Curry, capital, January 1, 2011 ......... .................................. $600,000
withdrawals...........45,000
LessNetloss ..........$13,500
Decrease in owners equity....$31500
Mavis Curry, capital,
December 31, 2011 .................$568500