You are considering buying a business that has assets of $148,000. Owner's equity is shown as $45,000. What is the amount of liabilities in that business?
A) $103,000
B) $93,000
C) $112,000
D) $108,000

Question

Quizplus · Accepted Answer

The amount of liabilities in the business can be calculated using the accounting equation: Assets = Liabilities + Owner's Equity. Given that Assets = $148,000 and Owner's Equity = $45,000, we can rearrange the equation to find Liabilities = Assets - Owner's Equity = $148,000 - $45,000 = $103,000.

You Are Considering Buying a Business That Has Assets of $148,000