Financial information related to Udder Products Company, a proprietorship, for t

ID: 2328032 • Letter: F

Question

Financial information related to Udder Products Company, a proprietorship, for the month ended April 30, 2019, is as follows: Net income for April Mark Kominksy's withdrawals during April Mark Kominksy's capital, April 1, 2019 $166,000 25,000 384,500 Required 1. Prepare a statement of owner's equity for the month ended Aprit 30, 2019. Refer to the ists of Labels and Amount Descriptions for the exac wording of the answer choices for text entries. Be sure to complete the statement heading. If a net loss is incurred or there is a decrease in owner's equity, enter that amount as a negative number using a minus sign 2. Why is the statement of owners equity prepared before the April 30, 2019, balance sheet?

Explanation / Answer

Part 1

Udder Products Company

Statement of Retained earnings

For the month ended April 30 2019

Mark Kominsky , Capital , April 1, 2019

$ 384,500.00

Net income for April

$ 166,000.00

Withdrawals

$ (25,000.00)

Increase in Owner's Equity

$ 141,000.00

Mark Kominsky , Capital , April 30, 2019

$ 525,500.00

Part 2

The Statement of Owner's Equity is prepared before April 30 2019 Balance Sheet Because Capital Account balance is Needed for the balance sheet.

Further explanation

Closing balance of Capital or Retained earnings or Owner’s equity is required for balance sheet matching. Accounting Equation of Assets equal Liabilities and Owner’s equity will not be valid until owner’s equity balance is ascertained, and that balance is ascertained only by preparing Statement of Owner’s equity.

Student is advance to change the Blank field of part two as per the Exact option given in the drop down.

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