Question

# Use the adjusted trial balance for Stockton Company to answer the questions that follow. Stockton Company...

Use the adjusted trial balance for Stockton Company to answer the questions that follow. Stockton Company Adjusted Trial Balance December 31 Account No. Debit Balances Credit Balances Cash 11 6,530 Accounts Receivable 12 2,100 Prepaid Expenses 13 700 Equipment 18 13,700 Accumulated Depreciation 19 1,100 Accounts Payable 21 1,900 Notes Payable 22 4,300 Bob Steely, Capital 31 12,940 Bob Steely, Drawing 32 790 Fees Earned 41 9,250 Wages Expense 51 2,500 Rent Expense 52 1,960 Utilities Expense 53 775 Depreciation Expense 54 250 Miscellaneous Expense 59 185 Totals 29,490 29,490 10. Use the adjusted trial balance for Stockton Company. Determine the owner’s equity ending balance. a. \$12,150 b. \$15,730 c. \$6,480 d. \$21,400

• Answer = option  b. \$15,730

Explanation :

Calculation of owner Equity

 Opening Capital 12,940 Net profit (w.n) 3,580 less : Drawing ( 790 ) 2,790 Ending balance / owner Equity ( 12940+2730) \$15,730
• Calculation of net profit ( working note) :

=   Fee earned - wages expenses - rent expenses - utilities expenses - Depreciation - Miscellaneous expenses

= 9,250 - 2,500 -  1,960 -  775 - 250 - 185

= 3,580

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