The beginning capital balance shown on a statement of owner's equity is $80,000. Net income for the period is $35,000. The owner withdrew $18,000 cash from the business and made no additional investments during the period. The owner's capital balance at the end of the period is
A)$63,000.
B)$133,000.
C)$97,000.
D)$80,000.

Question

Quizplus · Accepted Answer

The statement of owner's equity shows the changes in the owner's capital balance during a period. The formula to calculate the ending capital balance is:

Beginning capital balance + Net income - Owner withdrawals = Ending capital balance

Applying the numbers in the formula, we get:

$80,000 + $35,000 - $18,000 = $97,000

Therefore, the answer is C) $97,000.

The Beginning Capital Balance Shown on a Statement of Owner's