Accounting: What the Numbers Mean 9th Edition by Wayne W McManus, Daniel F Viele, David H Marshall

Exercise 35

If total assets were $21,000 and total liabilities were $12,000 at the beginning of the year, and if net income for the year was $5,000, what is total owners’ equity at the end of the year?

a. $4,000.

b. $5,000.

c. $9,000.

d. $14,000.

Step 1 of 2

Shareholder’s Equity:

It can be referred as one of the parts of the balance sheet other than the assets and the liabilities of the company. It is also known as owner’s equity of the company. Capital contributed and retained earnings are the two types of owner’s equity.