If Total Liabilities Are $2,000 and Total Assets Are $10,000,owner's

question 53

Multiple Choice

If total liabilities are $2,000 and total assets are $10,000,owner's equity must be:

• A)$8,000.
• B)$6,000.
• C)$10,000.
• D)$12,000.

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Definitions:

Operating Expenses

Operating expenses are the costs associated with the day-to-day operations of a business, excluding the cost of goods sold, such as rent, utilities, and payroll.

High-Low Method

A technique used in managerial accounting to estimate fixed and variable costs based on the highest and lowest levels of activity.

Variable Lubrication Cost

pertains to lubrication expenses that vary with the level of machinery operation or production volume.

Machine Hours

A measure of the total time that production equipment operates within a specific period.