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Accounting (Text Only)

26th Edition
Carl Warren + 2 others
ISBN: 9781285743615

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Accounting (Text Only)

26th Edition
Carl Warren + 2 others
ISBN: 9781285743615
Textbook Problem
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Statement of owner’s equity

Using the income statement for Ousel Travel Service shown in Practice Exercise 1-4A, prepare a statement of owner’s equity for the year ended November 30, 2016. Shane Ousel, the owner, invested an additional $50,000 in the business during the year and withdrew cash of $30,000 for personal use. Shane Ousel, capital as of December 1, 2015, was $666,000.

To determine

Statement of owners’ equity:

This statement reports the beginning owner’s equity and all the changes which led to ending owners’ equity. Additional capital, net income from income statement is added to and drawings are deducted from beginning owner’s equity to arrive at the end result, ending owner’s equity.

To prepare: Statement of Owners’ Equity of OT Service for the year ended November 30, 2016

Explanation

Prepare statement of owners’ equity of AT Service for the year ended November 30, 2016.

OT Service
Statement of Owners’ Equity
For the Year Ended November 30, 2016
SO capital, December 1, 2015   $666,000
Additional investment by owner $50,000  
Net income for the year 242,000  
Withdrawals (30,000)  
Increase in owners’ equity   262,000
SO capital, November 30, 2016   $928,000

Table (1)

Working Notes:

Prepare income statement for OT Service for the year ended November 30, 2016...

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