If a bank's assets are $135 million and its liabilities are $157 million, then its equity is $22 million.

Name: If a bank's assets are $135 million and its liabilities are $157 million, then its equity is $22 million.
Brand: Quizplus
Rating: 4.9 (42 reviews)

Question

Quizplus · Accepted Answer

The equation for the balance sheet is Assets = Liabilities + Equity. Therefore, Equity = Assets - Liabilities. In this case, Equity would be a negative $22 million, since the bank's liabilities exceed its assets.

If a Bank's Assets Are $135 Million and Its Liabilities