A company's balance sheet contained the following information: $\begin{array}{lrrr}
\text { Common Stock } & \$ 24,000 & \text { Total Assets } & \$ 352,000 \
\text { Accounts Payable } & 128,000 & \text { Retained Earnings } & 56,000
\end{array}$ Notes Payable is the only other item on the balance sheet.Notes Payable must equal:

Question

Quizplus · Accepted Answer

The balance sheet equation is Assets = Liabilities + Equity. Here, Equity includes both Common Stock and Retained Earnings. So, we have Total Assets = \$352,000, Common Stock = \$24,000, Retained Earnings = \$56,000, and Accounts Payable (a liability) = \$128,000. To find Notes Payable, we rearrange the equation to Liabilities = Assets - Equity. Therefore, Notes Payable + Accounts Payable = \$352,000 - (\$24,000 + \$56,000), which simplifies to Notes Payable + \$128,000 = \$272,000. Subtracting \$128,000 from both sides gives Notes Payable = \$144,000.

A Company's Balance Sheet Contained the Following Information Notes Payable Is the Only Other Item on the Balance