Business FinancesQuestion 293 of 1632
A contractor's balance sheet shows total assets of $400,000 and total liabilities of $250,000. What is the owner's equity?
a.$150,000
b.$250,000
c.$400,000
d.$650,000
Explanation
Owner's Equity = Assets − Liabilities = $400,000 − $250,000 = $150,000. Equity is the residual interest in the assets after liabilities are paid.
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)