Statement of owner’s equity

Definition

The statement of owner's equity is a financial document that summarizes the changes in owner's equity for a specific period. It includes contributions, withdrawals, and the net income or loss from operations.

5 Must Know Facts For Your Next Test

1. It shows the beginning and ending balances of owner's equity.
2. Includes additional investments made by the owner during the period.
3. Accounts for any withdrawals made by the owner.
4. Reflects the impact of net income or loss on owner's equity.
5. Helps stakeholders understand how profits are distributed between retained earnings and owner withdrawals.

Related terms

Income Statement:

A financial document that reports a company's financial performance over a specific accounting period.

Balance Sheet:

A financial statement that presents a company’s financial position at a specific point in time.

Statement of Cash Flows:

A financial document that provides aggregate data regarding all cash inflows and outflows during an accounting period.