The year end balance in the capital account is determined by:
A)the change in cash from the beginning to the end of the year.
B)the beginning capital balance, investments, net income or loss, and withdrawals.
C)only investments and withdrawals.
D)the change in total assets from the beginning to the end of the year.

Question

Quizplus · Accepted Answer

The year-end balance in the capital account is determined by the beginning capital balance plus any additional investments, plus net income or loss for the year, minus any withdrawals. This reflects the owner's equity in the business after accounting for the year's operations and any contributions or distributions.

The Year End Balance in the Capital Account Is Determined