The owners' equity of any business is equal to:

Question

Quizplus · Accepted Answer

Owners' equity is the residual interest in the assets of a business after deducting liabilities. Therefore, it is equal to assets minus liabilities. Option A is incorrect because revenues minus expenses results in net income, which affects owners' equity but is not equivalent to it. Option C is incorrect because assets plus liabilities equal total assets, not owners' equity. Option D is incorrect because paid-in capital is a component of owners' equity, but not the only one.

The Owners' Equity of Any Business Is Equal To