Explore BrainMass

Explore BrainMass

    Owner's Equity of a Proprietorship of Partnership

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    In comparison to the owners' equity section of a corporation's balance sheet, owners' equity of a proprietorship or partnership:
    a) normally does not make a distinction between invested capital and retained earnings
    b) normally uses "Capital" accounts for each individual owner, rather tha a "Retained Earnings" account for all of the owners.
    c) normally uses a "Drawings" account for each individual owner, rather than a "Dividends" account for all the owners.
    d) all of the above

    © BrainMass Inc. brainmass.com October 10, 2019, 5:49 am ad1c9bdddf

    Solution Preview

    The correct answer is d) all of the above.

    A sole proprietorship is an alter-ego of the company's owner. The owner usually has a single Capital account for his or her investments and earnings and a Drawings account for the ...

    Solution Summary

    This solution contrasts the equity section of a corporation to that of a partnership or sole proprietorship.