Question

Determine financial statement amounts and prepare owner's equity statement.

Answer 1

Answer and Explanation:

a. The first part is presented in the attached spreadsheet

b. The presentation is shown below:

Owner’s equity statement for Alpha Company:-

Particulars                      Amount($)

Opening balance             39,000

Additional investment    9,000

Income from operation    17,000

Available total equity   65,000

Less - Drawings          -15,000

Closing balance           50,000

c) For preparing the financial statements, the first part is to pass journal entries, than positing into ledger after that the income statement is made and then the stockholder equity and balance sheet are made

As the income statement records all revenues and expenses for the company . The same net profit or net loss is shown in the statement of stockholder equity and the closing balances of the retained earning and the common stock are recognized in the balance sheet along with the assets.