Statement of Owner Equity by XUVoOz

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									Statement of Owner Equity


 Gerry Schwab and Sherrill Nott
 Statement of Owner Equity
Purpose:
To reconcile the owner equity amount
 stated at the beginning of the time
 period, with the owner equity amount
 determined at the end of the time
 period.
            OWNER Equity
• Term used to describe value of the
  business after the total claims of creditors
  are subtracted from the value of the
  assets.

• The term “owner equity” refers only to a
  business and this statement includes no
  information for an individual person.
              Net Worth
• The term “net worth” is used to describe
  value of business plus personal valuation
  after the total claims of creditors are
  subtracted from the value of assets.
• The term “net worth” refers to a statement
  for an individual person or a statement for
  a business which also contains data for an
  individual person.
  Statement of Owner Equity
• Components should include:
  1. Beginning owner equity
  2. Plus net income amount
  3. Minus owner withdrawals
  4. Plus contributions received by business
  5. Minus contributions distributed to others
  6. Equals Change in Retained
     Earnings/Contributed Capital
  7. Ending Owner Equity (Cost Value Basis)
  Statement of Owner Equity
• Components should include:
  7. Ending Owner Equity (Cost Value Basis)
  8. Adjustment for change in (market value - cost
     value) from beginning to end of time period
  9. Equals change in market valuation equity
  10. Ending Owner Equity (Market Value Basis)
                    Statement of Owner Equity
                                                 Market          Cost

1. Owner Equity,
Beginning of Period
                                                 __________      __________
2a. Net Farm                       _________
Income/Loss
2b. Non-farm Income
Contributed to Farm
Business                           ________
3a. Withdrawals for
Family Living Expenses ________
3b. - Income and Social
Security Taxes          ________
3. Owner Withdrawals               ________
(net)
= Total Change in                                _____________   ______________
Retained Earnings
4. + Other Capital
Contributions/Gifts/               ___________
Inheritance received
5. - Other Capital
Distributions/Dividends/                         _____________   ______________
Gifts Made
6. = Total Change in
Contributed Capital &
Retained Earnings
7. Ending Owner Equity
(cost value basis)                                               ______________
                       Statement of Owner Equity
    8. Change in Excess of Market Value over Cost Basis of Marketable Securities and
                                 Farm Capital Assets
                            Beg.         End      Change         Market        Cost
                             -            +

Intermediate Assets      _________   __________   _________      _________     ___N.A.

Real Estate              _________   __________   _________      _________     ___N.A.

                            Beg.         End         Change      Market        Cost
                             +            -
Change in:

Deferred Liabilities     _________   _________    _________      _________     ___N.A.

9. Total Change in
Valuation Equity         _________   _________    _________      _________     ___N.A.

10. Owner Equity, End
of Period                                         _________      _________     ___N.A.
   Statement of Owner Equity (net worth)
            Cash Grain Farm -- Jan. to Dec. 1999
                                                     Market      Cost
1. Owner Equity,
Beginning of Period                                  1,111,550   247,050

2. Net Farm Income/Loss                   145,911

3. Non-farm Income
Contributed to Farm
Business                                  ______

3a. Withdrawals for Family
Living Expenses                (30,000)

3b. - Income and Social
Security Taxes                 (14,282)

3. Owner Withdrawals (net)                44,282

= Total Change in Retained                           101,629     101,629
Earnings
4. + Other Capital
Contributions/Gifts/                      ________
Inheritance received
5. - Other Capital
Distributions/Dividends/Gift
s Made
6. Total Change in                                   101,629     101,629
Contributed Capital &
Retained Earnings
7. Ending Owner Equity
(cost value basis)                                               348,679
                        Statement of Owner Equity

 8. Change in Excess of Market Value over Cost Basis of Marketable Securities and Farm
                                    Capital Assets
                        Beg.         End            Change          Market       Cost
                        -            +

Intermediate Assets     347,000      364,000        +17,000

Real Estate             517,500      520,500        +3,000

                        Beg.         End            Change          Market        Cost
                        +            -
Change in:

Deferred Liabilities

9. Total Change in                                                  +20,000         N/A
Valuation Equity

10. Owner Equity, End                                               $1,233,179    348,679
of Period
Statement of Owner Equity -- Summary


• Can determine CHANGE in Owner Equity
  from beginning to end of time period
• Components of change are:
  1 Retained earnings from profit
  2 Contributed capital from sources outside the
    business
  3 Inflation/Deflation -- Change in Market Values

								
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