Total liabilities are $100,000 and total owners' equity is $200,000.What are total assets?
A)We need to know retained earnings before we can compute total assets.
B)We need more information on current and long-term assets before we can compute total assets.
C)$100,000
D)$300,000

Question

Quizplus · Accepted Answer

Total assets can be calculated by adding total liabilities and total owners' equity. Therefore, total assets would be $300,000 ($100,000 liabilities + $200,000 owners' equity). Option A is incorrect because retained earnings is not necessary to calculate total assets. Option B is incorrect because we have enough information to compute total assets. Option C is incorrect because $100,000 only represents the total liabilities, not the total assets.

Total Liabilities Are $100,000 and Total Owners' Equity Is $200,000