Sarah Hodge is a self-employed piano teacher operating her business from home. She keeps her accounting records for business activities completely separate from her records for personal activities.

At 30 June 2018, Sarah had business assets and liabilities worth $62 500 and $41 000 respectively. At 30 June 2019, Sarah had business assets and liabilities worth $56 000 and $38 000 respectively.

Required

(a) Assuming Sarah did not contribute to or withdraw from the business during the financial year, determine the profit/loss for the year.

(b) Assuming Sarah had withdrawn $15 000 during the year, determine the profit/loss for the year.

(c) Assuming Sarah had contributed $20 000 and withdrawn $12 000, prepare a statement of changes in equity for the year.