Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $196,000,

Question

Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $196,000, expenses of $109,200, and withdrew $22,400 from the business during the current year. The owner’s capital account before closing had a balance of $308,000. The ending owner’s capital balance after closing is:

$196,000

$64,400

$86,800

$372,400

$394,800

Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $196,000, expenses of $109,200, and withdrew $22,400 from the business during the current year. The owner’s capital account before closing had a balance of $308,000. The ending owner’s capital balance after closing is:

Explanation / Answer

Ending balance=Beginning balance+(Revenues-Expenses-Withdrawals)

=308000+(196000-109200-22400)

=$372400

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