Question

Chapter 2 1 Required Information Use the following Information for Exercises 16-18 below. The following information applies to the questions displayed below) Carmen Camry operates a consulting firm called Help Today, which began operations on August 1 On August 31, the company's records show the following accounts and amounts for the month of August Cash Accounts receivable Office supplies Land Office equipment Accounts payable $ 25,00 C. Camry, withdrawals 22,166 Consulting fees carried 5,250 Rent expense 44.000 salaries expense 20,000 Telephone expense 10,50 Miscellaneous expenses $ 6,00 27,600 9,550 5,600 860 52e Exercise 2-17 Preparing a statement of owner's equity LO P3 Use the above Information to prepare an August statement of owner's equity for Help Today. The owner's capital account balance at July 31 was $0, and the owner invested $102,000 cash in the company on August 1. HELP TODAY Statement of Owner's Equity < Prev 4 5 Next >

Answer 1

Closing owners capital = Beginning owners capital + capital invested + net income - drawings.

So, first need to calculate the net income.

Net income = consulting fees earned - rent expense - salaries expense - telephone expense - miscellaneous expense.

Net income = 27,000 - 9,550 - 5,600 - 860 - 520

Net income = $ 10,470.

Additional capital invested = $ 102,000.

Drawings = $ 6,000

STATEMENT OF OWNERS EQUITY

Beginning Balance	$ 0
Add: Capital invested	$ 102,000
Add: Net income earned	$ 10,470
Less: Withdrawals	- ( $ 6,000)
Ending Balance	$ 106,470

SUMMARY:

The ending balance in owners capital is $ 106,470.