Question

In each of the two sets of organization financial statement information, two items have been omitted. Replace the question marks with the missing amounts. Use the area below the table to show any calculations used to arrive at the final answer for each missing amount.

	Smith Industries ($)	Jones Chips, Inc. ($)
Beginning of year:
Total assets	110,000	129,000
Total liabilities	85,000	129,000-80,000= 49,000
Total equities	110,000-85,000=25,000	80,000
End of year:
Total assets	160,000	180,000
Total liabilities	120,000	50,000
Total equities	40,000	130,000
Changes during the year in equities:
Additional owner investment	Stockholder equity 25,000-40,000-(	25,000
Owner's withdrawals	29,000	?
Total revenues	215,000	100,000
Total expenses	175,000	60,000

Answer 1

Solution:

Smith Industries:

Net Income during the Year = Total Revenue - Total Expenses = $215000 - $175000 = $40,000

Now,

Ending Equities = Beginning Equities + Net Income During the Year + Additional Owners Investment - Owner's Withdrawals

$40000 = $25000 + $40000 +Additional Owners Investment - $29000

Additional Owner Investment = $40000 - ($25000 +$40000- $29000) = $4,000

Jones Chips Inc.

Net Income during the year = $100000 - $60000 = $40,000

Ending Equities = Beginning Equities + Net Income During the Year + Additional Owners Investment - Owner's Withdrawals

$130000 = $80000 + $40000 + $25000 - Owners Withdrawals

Owner's Withdrawals = $80000 + $40000 +$25000 - $130000 = $15,000