Accounting Bellwork3rd Hour: How does the When line of the heading of the Income Statement read.
For the Month Ended October 31, 200-
Section 2 The Statement of Changes in Owner’s Equity
What You’ll Learn
The purpose of the statement of changes in owner’s equity.
How to prepare the statement of changes in owner’s equity.
Why It’s Important
One way to evaluate how a business is performing is by tracking the increase or decrease in owner’s equity.
Section 2 The Statement of Changes in Owner’s Equity (con’t.)
Key Terms statement of changes in owner’s
equity
The Statement of Changes in Owner’s Equity
Statement of changes in owner’s
equity summarizes changes in the
owner’s capital account as a result of
business transactions during the
period.
Section 2 The Statement of Changes in Owner’s Equity (con’t.)
The Statement of Changes in Owner’s Equity (con’t.)
The information to prepare this statement is found in three places:
Section 2 The Statement of Changes in Owner’s Equity (con’t.)
the work sheet the income statement the owner’s capital account in the
general ledger
Same as worksheet WHEN
Money Started the month with.
Money or Items invested by owner
From the worksheet or Income Statement
From the Worksheet
To show a net loss, refer to p213.
Demonstration Problems Ch9
Problem 9-4
Prime Printing Co.Statement of Changes in Owners Equity
For the month ended June 30, 200-
8714.212500.--
4146.02
Beginning Capital, June 1, 200-
6646.02
Add: Investments by OwnerNet Income
Total Increases in CapitalSubtotalLess: Withdrawals by Owner
15360.23
Ending Capital, June 30, 2004600.--
14760.23
Check Your Understanding p214
Thinking Critically 1 & 2
Problem 9-2
Section 1 Preparing the Work Sheet (con’t.)