[beplmi]

I cannot figure out how to get owners capital. All the information is provided for me such as: Assets=71,288: liabilites= 2,260: Owners withdrawls=14,420: revenues= 53,085: and expenses= 28,675

This is not a homework problem. I know I have to use assets=liabilities +equity but I do not understand exactly how to find that missing number.

[pready]

You need to start with the basic accounting equation, which is:
Assets = Liabilities + Owners Equity

Which can be rewritten as:
Owners Equity = Assets - Liabilities

The other information is needed only if determining the beginning Owners Equity. The other formula needed is:
Ending Owners Equity = Beginning Owners Equity + Owners Investments + Net Income - Owners Withdrawals

Which can be rewritten as:
Beginning Owners Equity = Ending Owners Equity - Owners Investments - Net Income + Owner Withdrawals

Now the formula for Net Income is:
Net Income = Revenues - Expenses

[beplmi]

Im still not understanding. I don't have any information on the owners capital and that's what I need to figure out. The owners capital is $59,038 but I don't understand the steps to getting that number. The book does not show how to solve for the missing number. Just tells me to use that equation but it doesn't work. I need this to be broken down a little more for me

Thank you

[pready]

Equity = Assets - Liabilities
So:
$71,228 - 2,260 = $69,028

Net Income = Revenues - Expenses
So:
$53,085 - 28,675 = $24,410 Net Income

Net Income - Owners Withdrawals = Amount added to Retained Earnings
So:
$24,410 - 14,420 = $9,990

Owners Investments = Ending Owners Equity - Retained Earnings
So:
$69,028 - 9,990 = $59,038 Owners Investments.

[beplmi]

Ah! I understand. That is one long process to go through!

Thank you very much.