Question

Total assets – Total external liabilities equal to

Answer 1

Total Asset = Total External Liabilities = Capital / Capital Employed

Answer 2

Total assets – Total external liabilities equal to Net worth

Explanation:

• Net Worth is equal to Total assets minus Total external liabilities.
• Net Worth is calculated by finding the difference between total liabilities and external liabilities.
• Total assets is same as to Total liabilities so, Net worth = Total Assets - External Liabilities which is owners fund.
• Net worth is a portion of the firm's total liabilities from which all types of external liabilities are paid. Sometimes Net worth is known as proprietor fund or owners equity.

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Total assets – Total external liabilities equal to

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