The Assets of a Business Total $20,000; the Liabilities, $8,000

question 30

Multiple Choice

The assets of a business total $20,000; the liabilities, $8,000. The claims of the owners are:

• A)$28,000.
• B)$8,000.
• C)$12,000.
• D)$20,000.
• E)$0.

---

Definitions:

Fiscal Year

A 12-month period used for accounting purposes that may not coincide with the calendar year.

Callable Bond

A bond that can be redeemed or "called" by the issuer before its maturity date, usually at a premium above par value.

Term Bond

A type of bond that matures on a specific date in the future and pays back the principal amount at that time, often alongside regular interest payments.

Convertible Bond

A type of bond that can be converted into a predetermined amount of the company's equity at certain times during its life, usually at the discretion of the bondholder.