If owners' equity at the beginning of the accounting period was $60 000 and at the end of the period was $75 000,and drawings by the owner during the period were $20 000,how much profit was earned during the period?
A)$15 000
B)$35 000
C)$25 000
D)$5000

Question

Quizplus · Accepted Answer

The increase in owners' equity is $15,000 ($75,000 - $60,000). Since the owner also withdrew $20,000, the profit must have been $35,000 to account for both the increase in equity and the drawings.

If Owners' Equity at the Beginning of the Accounting Period