The Total Assets Amount to $26,000 and the Total Liabilities

question 91

Multiple Choice

The total assets amount to $26,000 and the total liabilities amount to $18,000.The amount of the owner's equity is

• A) $18,000.
• B) $44,000.
• C) $26,000.
• D) $8,000.

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Definitions:

Fixed Ratio

A prescribed relationship between two quantities, expressed as a constant value.

Net Income

The total earnings of a company after deducting all costs and expenses from revenue, indicating the company's profitability.

Liquidation

The process of closing a business by selling its assets to pay off its liabilities, with any remaining proceeds distributed to shareholders or owners.

Income Statement

A financial statement that shows a company's revenues, expenses, and net income over a specific period of time.