Emmitt had the following final balances after the first year of operations: assets,$55,000;stockholders' equity,$25,000;dividends,$3,000;and net income,$10,000.What is the amount of Emmitt's liabilities?
A)$55,000.
B)$30,000.
C)$13,000.
D)$7,000.

Question

Quizplus · Accepted Answer

The accounting equation is Assets = Liabilities + Stockholders' Equity. Given assets of $55,000 and stockholders' equity of $25,000, liabilities can be calculated as $55,000 - $25,000 = $30,000.

Emmitt Had the Following Final Balances After the First Year