Question: A sole proprietorship had the following assets and liabilities at the beginning and end of this year.
Assets Liabilities
Beginning of the year . . . . . . . . . $ 70,000 $30,000
End of the year . . . . . . . . . . . . . 115,000 46,000
Determine the net income earned or net loss incurred by the business during the year for each of the following separate cases:
a. Owner made no investments in the business and no withdrawals were made during the year.
b. Owner made no investments in the business but withdrew $1,250 cash per month for personal use.
c. Owner made no withdrawals during the year but did invest an additional $45,000 cash.
d. Owner withdrew $1,250 cash per month for personal use and invested an additional $25,000 cash.