Question

The beginning capital balance shown on a statement of owner's equity is $72,000. Net income for the period is 22,000. The owner withdrew $30,000 cash from the business and made no additional investments during the period. The owner's capital balance at the end of the period is

Answer 1

Beginning capital = $72,000

Net income = $22,000

Drawings = $30,000

Capital ending = Beginning capital + Net income - Drawing

= 72,000 + 22,000 - 30,000

= $64,000

Owner's capital balance at the end of the period = $64,000

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