Use the following information for questions 140-141.
Metzger Company compiled the following financial information as of December 31, 2008:
-Metzger's owner's equity on December 31, 2009 is
A) $70,000.
B) $60,000.
C) $75,000.
D) $85,000.

Question

Use the following information for questions 140-141.
Metzger Company compiled the following financial information as of December 31, 2008: 
-Metzger's owner's equity on December 31, 2009 is
A) $70,000. 
B) $60,000. 
C) $75,000. 
D) $85,000.

Quizplus · Accepted Answer

Owner's equity on December 31, 2009 can be calculated as follows:

Owner's equity (12/31/09) = Owner's equity (12/31/08) + Net income earned in 2009 – Dividends paid in 2009

= $50,000 + $20,000 - $5,000

= $75,000

Use the Following Information for Questions 140-141