What is the formula for determining owners' equity?
A) Assets minus liabilities
B) Assets plus liabilities
C) Assets minus goodwill
D) Current assets minus current liabilities
E) There is no formula for computing owners' equity.

Question

Quizplus · Accepted Answer

Owners' equity is calculated as the difference between the company's assets and its liabilities. It represents the amount of capital that the owners have invested in the business, plus any retained earnings that have accumulated over time. Therefore, the correct formula for determining owners' equity is Assets minus Liabilities.

What Is the Formula for Determining Owners' Equity