Metropolitan Casting Services started the year with total assets of $130,000 and total liabilities of $60,000.The company is a sole proprietorship.The revenues and the expenses for the year amounted to $130,000 and $50,000,respectively.During the year,there were no new capital contributions and the owner withdrew $60,000.Calculate the amount of increase or decrease in owner's equity for the year.
A) a $20,000 increase
B) a(n) $90,000 increase
C) a(n) $70,000 decrease
D) a $60,000 increase

Question

Quizplus · Accepted Answer

A) Equity (at the beginning of the year) = $130,000 - $60,000 = $70,000
Equity (at the end of the year) = Owner, Capital (beginning balance) - Withdrawals + Revenues - Expenses 11ea8873_d431_03ef_bb89_d36ee8fa0f22_TB5026_00 Change in owner's equity for the 11ea8873_d431_2b00_bb89_7b6b57dec802_TB5026_00

Metropolitan Casting Services Started the Year with Total Assets of $130,000