Question

The balance of​ Morgan, Capital at the beginning of the year and the end of the year was $ 45,000 and $ 70,000​, respectively. There were no new capital contributions during the year. Owner withdrawals were $ 23,000. What was the net income or loss for the​ year?

Answer 1

Answer:

$48,000

Explanation:

Given that,

Ending owner's equity = $70,000

Beginning owner's equity = $45,000

Owner's withdrawals = $23,000

There were no new capital contributions during the year.

Net income (loss):

= Ending owner's equity - Beginning owner's equity + Owner's withdrawals

= $ 70,000 - $ 45,000 + $ 23,000

= $48,000

Therefore, the net income for the year is $48,000.