Chapter 8, Problem 2E

Exercise 8-2 Effect of accounting events on the financial statements of a sole

proprietorship

A sole proprietorship was started on January 1, 2018, when it received $60,000 cash from Marlin Jones, the owner. During 2018, the company earned $35,300 in cash revenues and paid $16,200 in cash expenses. Jones withdrew $1,000 cash from the business during 2018.

Required

Prepare the income statement, capital statement (statement of changes in equity), balance sheet, and statement of cash flows for Jones’s 2018 fiscal year.