Question

Midyear on july 31st, the baldwin corporation's balance sheet reported: total assets of $166.859 million total common stock of $5.080 million cash of $8.040 million retained earnings of $36.411 million. what were the baldwin corporation's total liabilities?

Answer 1

In the balance sheet, in order to account for the money or amounts that go to an fro in the sheet, we use the equation,
              NW = As - Li
where NW is the networth, As is the asset, and Li is liabilities.

From the given above, the total asset (As) is given to be $166.859M. The net worth is equal to the sum of the common stock, cash, and retained earnings.
             Networth = ($5.080 M) + ($8.040 M) + ($36.411 M)
            Networth = $49.531

The the equation above, we may derive the equation for liability by transposing,
                Li = Asset - Networth
                Li = ($166.859 M) - ($49.531 M)
                Li = $117.328

Hence, the total liability is equal to $117.328.