(L. OBJ. 9, 10) Preparing financial statements and evaluating business performance [10—1...

(L. OBJ. 9, 10) Preparing financial statements and evaluating business performance [10—15 min]

The assets, labilities, owner’s equity, revenues, and expenses of Carter Design Studio have the following balances at December 31, 2010, the end of its first year of operation. During the year, the owner invested $17,000.

Requirements

1. Prepare the income statement of Carter Design Studio for the year ended December 31, 2010. What is the result of operations for 2010?

2. What was the amount of the owner’s withdrawals during the year?