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
