Preparing an income statement, a statement of owner’s equity, and a balance sheet.The equa...

Preparing an income statement, a statement of owner’s equity, and a balance sheet.

The equation below shows the transactions of Kathryn Proctor, Attorney and Counselor of Law, during August. This law firm is owned by Kathryn Proctor.

INSTRUCTIONS

Analyze each transaction carefully. Prepare an income statement and a statement of owner’s equity for the month. Prepare a balance sheet for August 31, 2016. List the expenses in detail on the income statement.

Analyze: In order to complete the statement of owner’s equity, which amount was transferred from the income statement?