Chapter 11, Problem 11.15ME

(Supplement 11A) Comparing Owner's Equity to Stockholders' Equity

On January 2, Daniel Harrison contributed $20,000 to start his business. At the end of the year, the business had generated $30,000 in sales revenues, incurred $18,000 in operating expenses, and distributed $5,000 for Daniel to use to pay some personal expenses. Prepare (a) a statement of owner’s equity, assuming this is a sole proprietorship; (b) the owner’s equity section of the balance sheet, assuming this is a sole proprietorship; and (c) the stockholder’s equity section of the balance sheet, assuming this is a corporation with no-par value stock.