Question

1. Use the following information to calculate for the year ended December 31, 2014 (a) net income, (b) ending owner's equity, and (c) total assets. Supplies Operating expenses Accounts payable Accounts receivable Beginning Capital $ 3,000 12,000 9,000 3,000 5,000 Revenues Cash Drawings Notes payable Equipment $25,000 15,000 1,000 1,000 6,000​

Answer 1

To calculate for the year ended December 31, 2014, the net income is $10,000, the ending owner's equity is $14,000, and the total assets is $33,000.

Step-by-step explanation:

To calculate the net income, ending owner's equity, and total assets for the year ended December 31, 2014, you need to use the given information and apply the accounting equation:

Accounting Equation:

Assets = Liabilities + Owner's Equity

Given information:

Supplies = $3,000

Operating expenses = $12,000

Accounts payable = $9,000

Accounts receivable = $3,000

Beginning Capital = $5,000

Revenues = $25,000

Cash = $15,000

Drawings = $1,000

Notes payable = $1,000

Equipment = $6,000

1. Net income = Revenues - Expenses
2. Net income = $25,000 - ($3,000 + $12,000)
3. Net income = $25,000 - $15,000
4. Net income = $10,000
5. Ending owner's equity = Beginning Capital + Net income - Drawings
6. Ending owner's equity = $5,000 + $10,000 - $1,000
7. Ending owner's equity = $14,000
8. Total assets = Liabilities + Owner's Equity
9. Total assets = Accounts payable + Accounts receivable + Cash + Equipment
10. Total assets = $9,000 + $3,000 + $15,000 + $6,000
11. Total assets = $33,000