Asked by Michael Frank on Jun 20, 2024
Verified
If the liabilities owed by a business total $300,000 and stockholders' equity is equal to $300,000, then the assets also total $300,000.
Stockholders' Equity
Ownership interest reflected by what is left of a company's assets once liabilities have been deducted.
- Familiarize with the underlying principles of the accounting equation and its repercussions for business activities and the presentation of financial statements.
Verified Answer
CT
Caleb TumblesonJun 25, 2024
Final Answer :
False
Explanation :
According to the accounting equation, Assets = Liabilities + Stockholders' Equity. If liabilities are $300,000 and stockholders' equity is $300,000, then assets would total $600,000 (300,000 + 300,000).
Learning Objectives
- Familiarize with the underlying principles of the accounting equation and its repercussions for business activities and the presentation of financial statements.