On the statement of changes in owner's equity, how do you find the beginning capital?
To find the beginning capital on the statement of changes in owner's equity, you generally need two pieces of information:
1. Opening Balance Sheet: The beginning capital is typically derived from the previous period's closing balance of the owner's equity. You can refer to the opening balance sheet of the financial statements for this information. The opening balance sheet represents the financial position of the business at the start of the reporting period.
2. Adjustments or Additional Information: Sometimes, there may be additional information or adjustments provided apart from the opening balance sheet. This could include any changes in the owner's equity that have occurred between the opening balance sheet date and the beginning of the current reporting period. Examples of such adjustments could be capital contributions or withdrawals made by the owner during that period.
By considering these two pieces of information, you can determine the beginning capital for the statement of changes in owner's equity. It is important to note that the beginning capital can vary depending on the accounting period under consideration.