Statement of Changes in Equity
Statement of Changes in Equity
On February 15, 20x1, Michelle Perez opened Red Goldy Bakeshop. She
invested P75,000 to purchase an oven and bakery supplies. The business generated a
net income of P37,545 in 20x1. Moreover, Michelle used P15,000 from the account of
Red Goldy Bakeshop to pay the electricity and phone bills of her house.
Michelle invested an additional P13,400 and P17,650 on March 16, 20x2 and
August 19, 20x2, respectively. Net income for 20x2 was reported at P48,950. Michelle,
Drawings account has a balance of P200,000 on December 31, 20x2.
Required: Prepare Red Goldy Bakesop’s Statement of Changes in Equity for the year
ended December 31, 20x1 and December 31, 20x2.
Problem 2:
The Playdate Kiddie Gym is owned and managed by Cris Roxas. The balance of
the Cris Roxas, Capital is P765,430 and P857,340 on December 31, 20x1 and
December 31, 20x2, respectively. Net income for 20x2 is P115,465. Cris did not make
additional contribution to the business in 20x2. Determine the balance of the Cris
Roxas, Drawing account on December 31, 20x2.