Question

Use the adjusted trial balance for stockton company below to answer the questions that follow. stockton company adjusted trial balance december 31 cash 6,530 accounts receivable 2,100 prepaid expenses 700 equipment 13,700 accumulated depreciation 1,100 accounts payable 1,900 notes payable 4,300 bob steely, capital 12,940 bob steely, withdrawals 790 fees earned 9,250 wages expense 2,500 rent expense 1,960 utilities expense 775 depreciation expense 250 miscellaneous expense 185 â totals 29,490 29,490 â determine the owner's equity ending balance.

Answer 1

Answer: The Owner’s Equity ending balance is $15,730.

Explanation: In order to calculate the ending owner’s equity you need to identify the capital, revenue and expense accounts.

The Owner’s Equity is $12,940 and withdrawals are $790.

Revenue (Fees Earned) is $9,250.

Expenses equal 2,500 + 1,960 + 775 + 250 + 185 = $5,670.

Now that we have identified the each of the three categories, we will use the owner’s equity equation.

Owner’s Equity = Capital - Drawing + Revenues - Expenses

Owner’s Equity = $12,940 - 790 + 9,250 - 5,670

Owner’s Equity = $15,730