Net Worth Is Equal to Stockholders' Equity

question 56

Multiple Choice

Net worth is equal to stockholders' equity

• A) plus dividends.
• B) minus preferred stock.
• C) plus preferred stock.
• D) minus liabilities.

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Definitions:

Legal Entity

An organization that has legal rights and obligations, including the ability to enter into contracts, own property, and be subject to lawsuits; can be a corporation, partnership, trust, or non-profit organization.

Personal Liability

Refers to the responsibility individuals have for their actions, especially in legal or financial contexts, where they can be held liable for damages or debts.

Sole Proprietorship

An individual pursuing business for a profit.

Life Cycle

The series of stages through which an entity (product, organization, project) passes from its inception to its conclusion or revitalization.