Asked by Angelica Renata on Jul 03, 2024
Verified
Which of the following equations is equivalent to the accounting equation?
A) Equity = liabilities - assets
B) Owners' equity = assets - liabilities
C) Revenues - expenses = net income
D) Net income = expenses - revenues + taxes
E) Profit = sales - revenues
Accounting Equation
Assets equal liabilities plus owners’ equity.
Net Income
The total profit (or loss) after all expenses, including taxes, have been deducted from revenue; also called net earnings.
- Learn the specific terms and process flows within accounting, focusing on financial entries, the orderly progression of the accounting cycle, and vital equations.
Verified Answer
CW
Caylan WhelanJul 08, 2024
Final Answer :
B
Explanation :
The accounting equation is Assets = Liabilities + Owners' Equity. Choice B is equivalent because it rearranges the equation to Owners' Equity = Assets - Liabilities.
Learning Objectives
- Learn the specific terms and process flows within accounting, focusing on financial entries, the orderly progression of the accounting cycle, and vital equations.
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