Question

bobs vanhy services
balance sheet
assets = 587,500
cash- 125,000
supplies - 4,500
land - 380,000
accounts receivable - 78,000
liabilities = 113,000
accounts payable - 38,000
salaries payable -75,000
owners equity =474,000
bob, capital-474,000
bob, drawings-15,000
175,000
78,000
4,500
380,000
587500
38,000
75,000
113,000
$587,500 = 113,000 +
-113,000
474500

Explanation:

Step1: Verify total assets sum

Add all asset accounts:
$\$175,000 + \$4,500 + \$380,000 + \$28,000 = \$587,500$

Step2: Verify total liabilities sum

Add all liability accounts:
$\$38,000 + \$75,000 = \$113,000$

Step3: Calculate required owner's equity

Use accounting equation: $\text{Assets} = \text{Liabilities} + \text{Owner's Equity}$
Rearrange to solve for Owner's Equity:
$\text{Owner's Equity} = \text{Assets} - \text{Liabilities}$
$\$587,500 - \$113,000 = \$474,500$

Step4: Adjust for owner's drawings

Bob's Capital is the ending owner's equity, so the listed $\$474,000$ plus drawings $\$15,000$ would be the prior equity, but the corrected ending equity matching the accounting equation is $\$474,500$.

Answer:

The corrected Owner's Equity (Bob's Capital, net of drawings) that balances the accounting equation is $\$474,500$, confirming the accounting equation $\boldsymbol{\$587,500 = \$113,000 + \$474,500}$ holds true.