The owner's Capital, Withdrawals, and Income Summary accounts for Laurel Repair Company for the accounting period are presented below in T account form after the recording and posting of closing entries: The Fran Laurel, Capital balance on 1/1 was

Question

The owner's Capital, Withdrawals, and Income Summary accounts for Laurel Repair Company for the accounting period are presented below in T account form after the recording and posting of closing entries:  The Fran Laurel, Capital balance on 1/1 was

Quizplus · Accepted Answer

The Fran Laurel, Capital balance on 1/1 was $2,000. This can be determined by looking at the beginning balance of the Capital account and deducting any withdrawals or adding any net income for the accounting period. In this case, there were no withdrawals, and the net income was $200, so the ending balance of the Capital account is $2,200. Therefore, the beginning balance must have been $2,000.

The Owner's Capital, Withdrawals, and Income Summary Accounts for Laurel