Faith Busby and Jeremy Beatty started the B&B partnership on January 1, Year 1. The business acquired $93,000 cash from Busby and $207,000 from Beatty. During Year 1, the partnership earned $62,900 in cash revenues and paid $34,050 for cash expenses. Busby withdrew $2,900 cash from the business, and Beatty withdrew $4,700 cash. The net income was allocated to the capital accounts of the two partners in proportion to the amounts of their original investments in the business.
Faith Busby and Jeremy Beatty started the B&B partnership on January 1, Year 1. The business acquired $93,000 cash from Busby and $207,000 from Beatty. During Year 1, the partnership earned $62,900 in cash revenues and paid $34,050 for cash expenses. Busby withdrew $2,900 cash from the business, and Beatty withdrew $4,700 cash. The net income was allocated to the capital accounts of the two partners in proportion to the amounts of their original investments in the business.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Faith Busby and Jeremy Beatty started the B&B
Required
Prepare an income statement, capital statement (statement of changes in equity),
Transcribed Image Text:Income
Statement
Capital
Statement
Prepare the income statement.
Cash
Expenses
Net income
Balance Sheet
Stmt of Cash
Flows
B&B PARTNERSHIP
Income Statement
For the Year Ended December 31, Year 1
$
0
Transcribed Image Text:Income
Statement
Capital
Statement
Prepare a capital statement.
Beginning capital balance
Plus: Capital acquired from owner
Less: Withdrawal by owner
Ending capital balance
Balance Sheet
Stmt of Cash
Flows
B&B PARTNERSHIP
Capital Statement
For the Year Ended December 31, Year 1
$
0
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