Question 8.

CASH +A/R +SUPP. +EQ. = A/P +CPT -DRAWINGS. +REV -EXP.

1 +15000 0 15000
2 -2000 0 +5000 +3000
3 -750 0 +750
4 +4600 +3900 +8500
5 -1500 0 -1500
6 -2000 0 -2000
7 -650 0 -650
8 +450 -450
9 -4800 0 -4800
10 0 0 +400 -400
ASSETS= 17550 Libiltites=1900

Answer (a):
1. Arthur Cooper and co. invested 15000 in Business.
2. Purchase equipment worth 5000. They paid 2000 on cash and 3000 on account.
3. They paid for supplies worth 750 on cash.
4. They Earned revenue of 4600 on cash and 3900 on account.
5. Paid 1500 on A/P. (e.g. rent or something else)
6. He Draw 2000 out from business.
7. Paid 650 cash as rent.
8. Received 450 on account.
9. Paid a total of 4800 for salary and and wages.
10. Paid 400 for utilities on account.

Answer(b):

Owner’s equity = Assests -liabilties

=17550 -1900

=15650

Answer(c):

Net income= total revenue - total expenses

=8500-5850

=2650

8.10

Answer(a):

Owner’s equity = Assests -liabilties

=400000-250000
 =150000

Increase in equity = 150000-100000 = 50000 (initial capital= 100000)

Adding stakeholders drawings : 15000

50000+15000 =65000

the net income for 2016 is 65000.

Answer(b):

Owner’s equity = Assests -liabilties

=460000-300000

=160000

Increase in equity = 160000-150000 = 10000 (owner’s equity for the last year= 150000)

Less: additional investment= 10000-45000 =-35000.

Net loss = 35000

So the net loss for 2017 is 35000.

Answer(c):

Owner’s equity = Assests -liabilties

=590000-400000

=190000

Increase in equity = 190000-160000 = 30000 (owner’s equity for the last year= 160000)

Less, additional investments : 30000-15000=15000.

Add: drawins 15000+25000 = 40000.

So the net income for 2017 is 40000.

Question 10.

Answer:

Income statement:

Armanda co.
 Income Statement

Service Revenue 63600

Less: Expenses
Salaries and wages exp. (29500)
Advertising exp. (1800)
Rent exp. (10400)
Utilities exp (3100)
--------------
Net income 18800

For the year Ending Owner’s Capital $48000 December 31, 2017
Add: Net income 18800
-------------
66800
Less: Drawings (6000)
-------------
Retained Earnings 60800

Equity Statement

Armanda co.

Owner’s equity Statement

For the year Ending December 31, 2017

Question 14;

Answer(a)

Clear View Park Co.

Income Statement

For the year ending December 31, 2017

 Revenues:
camping fees revenue 140000
General store revenue 65000
Total revenue 205000
Less: expenses (150000)
--------------
Net income 55000

Answer(B):