Asked by Doris Mansueto on May 20, 2024
Verified
Assets are
A) always lower than liabilities
B) equal to liabilities less owner's equity
C) the same as expenses because they are acquired with cash
D) financed by the owner and/or creditors
Assets
Assets are resources owned by a business or individual that have economic value and can bring about future benefits, such as cash, real estate, and machinery.
Liabilities
Financial obligations or debts of a business that arise during the course of its operations, required to be settled over time.
Owner's Equity
The residual interest in the assets of an entity after deducting liabilities, representing the capital owned by the shareholders or owner.
- Gain insight into the core practices of managing liabilities and assets.
Verified Answer
DP
Dayra PimentelMay 25, 2024
Final Answer :
D
Explanation :
Assets can be financed by the owner and/or creditors, therefore D is the correct answer. A is incorrect because assets can be higher than liabilities, B is incorrect because assets can be greater than or equal to liabilities plus owner's equity, and C is incorrect because not all assets are acquired with cash.
Learning Objectives
- Gain insight into the core practices of managing liabilities and assets.