Question

instructions
the revenues and expenses of up-in-the-air travel service for the year ended april 30, 20y7, follow:
fees earned $1,870,000
office expense 343,000
miscellaneous expense 21,000
wages expense 1,115,000
prepare a statement of owner’s equity for the year ended april 30, 20y7. jerome foley, the owner, invested an additional $52,000 in the business during the year and withdrew cash of $34,000 for personal use. jerome foley, capital as of may 1, 20y6, was $876,000. be sure to complete the statement heading. refer to the lists of accounts, labels, and amount descriptions provided for the exact wording of the answer choices for text entries. if required, use the minus sign to indicate any decreases in equity.

Explanation:

Step1: Calculate net income

First, sum all expenses, then subtract from fees earned.
Total Expenses = $343,000 + $21,000 + $1,115,000 = $1,479,000
Net Income = $1,870,000 - $1,479,000 = $391,000

Step2: Compute equity change from investments

Add additional investment to beginning equity.
Beginning Equity + Additional Investment = $876,000 + $52,000 = $928,000

Step3: Adjust for withdrawals and net income

Add net income, subtract owner withdrawals.
Ending Equity = $928,000 + $391,000 - $34,000

Answer:

Up-in-the-Air Travel Service
Statement of Owner's Equity
For the Year Ended April 30, 20Y7

Jerome Foley, Capital, May 1, 20Y6 | $876,000
--- | ---
Add: Additional Investment | $52,000
Add: Net Income | $391,000
Less: Withdrawals | $34,000
Jerome Foley, Capital, April 30, 20Y7 | $1,285,000