Question

Abby Roland is the bookkeeper for Cheng Company.Abby has been trying to determine the correct balance sheet for Cheng Company.Cheng's balance sheet is shown below

Cheng Company

Balance Sheet

December 31,2017

Assets 

Cash	$15,000
Supplies	8,000
Equipment	46,000
Owner's drawings	13,000
Total Assets	$82,000

Liabilities

Accounts Payable	$21,000
Accounts Receivable	(6,500)
Owner's Capital	67,500
Total Liabilities & Owner's Equity	$82,000

Prepare a correct Balance sheet

Answer 1

Cheng Company

Balance Sheet

As on December 31,2017

Assets	Amount$	Amount$
Current Assets :
Cash	15,000
Accounts Receivable	6,500
Office Supplies	8,000
Total Current Assets		29,500
Property,Plant & Equipment
Equipment	46,000
Total Property,Plant & Equipment		46,000
Total Assets		75,500
Liabilities
Current Liabilities :
Accounts Payable	21,000
Total Current Liabilities		21,000
Stockholder's Equity
Common stock	54,500
Total Stockholder's Equity		54,500
Total liabilities & Stockholder's Equity		75,500

 

Calculation of Owner's Equity

Owner's Equity = Owner's Capital in Balance sheet - Owner's Drawings

                         =  $67,500 - $13,000

                         =  $54,500

Debit & credit side of the balance sheet for the year ended on December 31,2017 are $75,500

Debit & credit side of the balance sheet for the year ended on December 31,2017 are $75,500