At October 1, Smithson Enterprises reported owner's equity of $35,000. During October, the owner made additional investments of $5,000 and the company posted a net loss of $3,000. If owner's equity at October 31 totals $35,000, what amount of owner drawings were made during the month?

Question

Quizplus · Accepted Answer

The owner's equity increased by the additional investment of $5,000 but decreased by the net loss of $3,000. To maintain the owner's equity at $35,000, drawings of $2,000 must have been made.

At October 1, Smithson Enterprises Reported Owner's Equity of $35,000