Owner equity is also known as the book value of a company because it is equal to total assets minus reported liabilities. Each co-owner of the airplane should have a capital account similar to the example shown on this balance sheet.
EXAMPLE BALANCE SHEET CLASSIFICATIONS
Cirrus-We-Own, LLC: Balance Sheet, May 31,2016
| ASSETS | LIABILITIES & OWNERS EQUITY | ||
| Cash & Receivables | 8,517 | Credit Cards | 690.55 |
| Funded Reserves | 19,000 | Loan Payable | |
| Prepaid Items | 4,543 | ||
| Aircraft: Cirrus SR22 | 230,600 | Capital Accounts | |
| Member – Jones | 87,323 | ||
| Member – Smith | 87,323 | ||
| Member – Brown | 87,323 | ||
| Total Assets | $262,660 | Total Liabilities | $262,660 |
Revenue and expenses are income statement accounts. We’ll review basic booking for those items in future posts.
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