The Beginning Capital Balance Shown on a Statement of Owner's

question 82

Multiple Choice

The beginning capital balance shown on a statement of owner's equity is $36,000. Net income for the period is $16,000. The owner withdrew $20,000 cash from the business and made no additional investments during the period. The owner's capital balance at the end of the period is

• A)$40,000.
• B)$72,000.
• C)$32,000.
• D)$36,000.

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Definitions:

Monopolistically Competitive

This refers to a market structure where many companies sell products that are similar but not identical, allowing for some degree of market power and product differentiation.

Economic Profit

The difference between a firm's total revenues and its opportunity costs, representing the additional gain over what could have been earned in the next best alternative.

Normal Profit

The minimum level of earnings needed for a company to remain in business, often considered as the company's opportunity cost.

Break Even

The juncture where the aggregate of all costs matches the total income, leading to neither a profit nor a loss.