Harriet Limited has non-current assets of £425,000, current liabilities of £142,000 and equity of £391,000. Harriet Limited has no non-current liabilities. Using the accounting equation, calculate the figure for current assets.
A) £108,000
B) £176,000
C) £674,000
D) £958,000

Question

Quizplus · Accepted Answer

The accounting equation is: Assets = Liabilities + Equity. We know that non-current assets are £425,000, current liabilities are £142,000 and equity is £391,000. Therefore, current assets must be £425,000 - £142,000 + £391,000 = £674,000.

Harriet Limited Has Non-Current Assets of £425,000, Current Liabilities of £142,000