Question

Question 28
If total assets of a business are Rs.10,00,000 and outside liabilities are 40% of the total assets. What
is the amount of owner's equity?
A=c+L.

Answer 1

Answer:

Rs. 6,00,000

Explanation:

Assets = Rs. 10,00,000,

Net worth or Owner's Equity = ?,

Outside Liability = Rs. 4,00,000 (40% of 10,00,000)

The accounting equation is:

Assets = Outside Liability + Owner's Equity or Net Worth  

Rs. 10,00,000 = Rs. 4,00,000 + Owner's Equity or Net Worth  

Owner's Equity or Net Worth = Rs. 10,00,000 - Rs. 4,00,000

Owner's Equity or Net Worth = Rs. 6,00,000