In: Accounting
At the beginning of the year, Sigma Company's balance sheet reported Total Assets of $294,000 and Total Liabilities of $113,500. During the year, the company reported total revenues of $347,000 and expenses of $268,500. Also, owner withdrawals during the year totaled $70,000. Assuming no other changes to owner's capital, the balance in the owner's capital account at the end of the year would be: Multiple Choice $189,000. $256,000. $186,000. $296,500. $183,000.
Answer: $189,000
Capital = Total assets - Liability
= $294,000 - $113,500
Capital = $180,500
Net Income = Revenue - Expense
= $347,000 - $268,500
Net Income = $78,500
Owners capital = Capital + Net Income - With drawls
= $180,500 + $78,500 - $70,000
Owners Capital = $189,000