If Assets Are $99,000 and Liabilities Are $32,000, Then Equity

question 20

Multiple Choice

If assets are $99,000 and liabilities are $32,000, then equity equals:

• A) $32,000.
• B) $67,000.
• C) $99,000.
• D) $131,000.
• E) $198,000.

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Definitions:

Total Assets

The sum of all current and non-current assets owned by an entity as reported on the balance sheet.

EBIT

Earnings Before Interest and Taxes; a measure of a firm's profit that includes all expenses except interest and income tax expenses.

Debt/Assets Ratio

A financial ratio that indicates the proportion of a company's assets that are financed by debt.

Common Equity

The amount of ownership interest that is common stockholders have in a company, reflecting their equity stake.