Question

Problem 5-1: Prepare a Statement of Owner Equity.

The Remo Appliance Repair is an appliance repair business, owned and operated by Remo Atif, sole proprietor. This is Remo’s second year of operation.

During XXX2, the business earned total revenues of $100,000, all from repair fees. Expenses totaled $40,000, and included: rent of $12,000; salary expense of $23,000; telephone expense of $1,200; utility expense of $2,400; and insurance expense of $1,400.

The Statement of Owner Equity for the year ended December 31, XXX1, showed ending owner equity of $20,000. There was no additional investment in the business during XXX2, but Remo Atif withdrew $50,000 cash from the business during the year.

Prepare the following financial statements the Remo Appliance Repair for the year ended December 31, XXX2:

1. Income Statement

        b.Statement of Owner Equity

Prepare a Statement of Owner Equity for Remo Appliance Repair for the year ended December 31, XXX1. This is Remo’s first year of operations.

              Remo Appliance Repair is owned by Remo Atif, sole proprietor.

Remo Atif, capital, January 1, XXX1	$0
Investments during XXX1	$25,000
Net income for XXX1	$45,000
Withdrawal of cash during XXX1	$50,000

Prepare a Statement of Owner Equity for Clearview TV Repair for the month ended August 31, XXX1.

              Clearview TV Repair is owned by Stanley Morton, sole proprietor.

Stanley Morton, capital, August 1	$23,000
Net income, August	4,000
Withdrawal of cash	2,500

Answer 1

Answer 1:

Answer 2: