Question

If a company had a beginning balance of $69,000 on its statement of changes in owner's equity, the owner had drawings of $15,000 and the ending balance was $76,000, how much net income was recorded

Answer 1

Answer: $22,000

Step-by-step explanation:

The Statement of Changes in Equity records how the equity holdings of shareholders has change during the year. It includes drawings which reduce the balance and net income which adds to it.

Net income = Ending balance - Opening balance + Drawings

= 76,000 - 69,000 + 15,000

= $22,000