Chapter 12, Problem 2PA

### College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

Chapter
Section

### College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

# Here is the partial work sheet for Eckland Stereo.Required 1. Prepare a statement of owner’s equity (no additional investment). 2. Prepare a balance sheet. 3. Determine the amount of the working capital. 4. Determine the current ratio (carry to two decimal places). Check FigureWorking capital, \$69,345

1.

To determine

Prepare a statement of owners’ equity for E Stereo for the year ended December 31, 20--.

Explanation

Statement of ownersâ€™ equity: This statement reports the beginning ownerâ€™s equity and all the changes which led to ending ownersâ€™ equity. Additional capital, net income from income statement is added to, and drawings is deducted from beginning ownerâ€™s equity to arrive at the end result, ending ownerâ€™s equity.

Prepare a statement of ownersâ€™ equity for E Stereo for the year ended December 31, 20--...

2.

To determine

Prepare a balance sheet for E Stereo, based on the account balances from work sheet, and capital of the owner from the statement of owners’ equity prepared in Part (1).

3.

To determine

Compute working capital of E Stereo (Refer to balance sheet for the values of current assets and current liabilities).

4.

To determine

Compute current ratio of E Stereo (Refer to balance sheet for the values of current assets and current liabilities).

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