Basic Instructions for a Owner’s Equity Statement

MJC Revised 5/2012 Page 1

Morrison Pet Supply Company

Statement of Owner’s Equity

For the Month Ended December 31, 20XX

A.L. Morrison, Capital, December 1, 20XX $XX,XXX

Investments during the month $XX,XXX

Net income for the month X,XXX

XX,XXX

Less: Withdrawals X,XXX

Increase in owner’s equity XX,XXX

A.L. Morrison, Capital, December 31, 20XX XX,XXX

Systematic Directions

Always start with the three-line header, which includes the name of the company, the title of the

statement, and the fiscal period covered by the statement.

1. On the first line in the body of the statement in the right hand column, place the

owner’s name followed by a comma and the word “Capital” then the beginning

date of the statement. In the left hand column, place the capital dollar amount

from the beginning of the year. This amount can be acquired from the adjusted

trial balance or the ledger after end of the year adjustments are posted.

2. On the second line, place the title “Investments during the month” in the left hand

column. Place the dollar amount in the middle column. If no investments by the

owner’s are made during the fiscal period, simple leave this line out of the

statement.

3. On the third line, place the title “Net income for the period” for the fiscal period.

Place the dollar amount in the middle column. This amount is acquired from the

income statement.

4. On the fourth line, add investments and net income for the period together to get

the dollar amount. There is no title for this line. Place the total dollar amount in

the center column.

5. On the fifth line, place the title “Less: Withdrawals” in the right hand column.

Place the dollar amount in the middle column.

6. On the sixth line, place the title “Increase in owner’s equity” in the right hand

column. Subtract withdrawals from the third line and place the answer in the right

hand column.

Basic Instructions for a Owner’s Equity Statement

MJC Revised 5/2012 Page 2

7. On the seventh line, place the title (Owner’s Name, Capital, Month-Day, and Year) in the

left hand column. Now add increases in owner’s equity to the beginning balance for

owner’s capital to get the dollar amount. Place the dollar amount in the right hand

column. Double underline the answer.

Note: Net losses are to be subtracted, as are withdrawals.