Notice how the Assets are above the Liabilities and Owner's Equity. Follow the model below. Royal City Engineering Balance Sheet September 30, 20-- Assets Bank $1,800 Accounts Receivable 19,500 Supplies 700 Prepaid Insurance 800 $22,800 Equipment $22,000 Automobiles 21.000 43,000 Total Assets 565,800 Liabilities and Owner's Equity Accounts Payable $ 4,535 P. Tang Capital Balance, January 1 Net Income $54,040 $22,225 Drawings 15,000 Increase in Capital 7,225 Balance, December 31 Total Liabilities and Equity 61,265 $65.800 Note - Assets will ALWAYS equal Liab. & Owners Equity Notice how the Assets are above the Liabilities and Owner's Equity. Follow the model below. Royal City Engineering Balance Sheet September 30, 20-- Assets Bank $1,800 Accounts Receivable 19,500 Supplies 700 Prepaid Insurance 800 $22,800 Equipment $22,000 Automobiles 21.000 43,000 Total Assets 565,800 Liabilities and Owner's Equity Accounts Payable $ 4,535 P. Tang Capital Balance, January 1 Net Income $54,040 $22,225 Drawings 15,000 Increase in Capital 7,225 Balance, December 31 Total Liabilities and Equity 61,265 $65.800 Note - Assets will ALWAYS equal Liab. & Owners Equity