Question

Determine the total expenses based on the following data:
Assets $72,000.00
Capital $70,000.00
Revenue $20,000.00
Liabilities $16,000.00

A. $138,000.
B. $34,000.
C. $106,000.
D. $38,000.

Answer 1

AS PER THE ACCOUNTING EQUATION

LIABILITIES + CAPITAL + PROFIT FOR THE YEAR = ASSETS

16,000 + 70,000 + PROFIT = 72,000

PROFIT = - 14,000 (LOSS)

REVENUE - EXPENSES = PROFIT

20,000 - EXPENSES = - 14,000

EXPENSES = 34,000

Answer 2

Answer:

Total expenses will be equals to $34000.

Explanation:

• Formula

Capital + Profit for the year + liabilities = Assets

• Given in the question -

Assets $72,000.00

Capital $70,000.00

Revenue $20,000.00

Liabilities $16,000.00

• Putting the values in the formula

Profit for the year = $ -14000

• Now, Revenue - Total Expenses = Profit for the year

Putting the values, we get

⇒  20000 - Total Expenses  = - 14000

⇒ Total Expenses = $ 34000

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