A business has the following items: - Land $1,500,000 - Machinery $30,000 - Cash $10,000 - Loan $500,000 - Owner’s equity? _____

Question

3 years ago

10

_______

1 answer:

vodomira [7] · Answer 1 · 2021-12-15T16:40:19+03:00

Answer:

The owner's equity amounts to $1,040,000

Explanation:

The formula to compute the owner's equity is as:

Owner's equity = Assets - Liabilities

Where

Assets = Land + Machinery + Cash

= $1,500,000 + $30,000 + $10,000

= $1,500,000 + $40,000

= $1,540,000

Liabilities = Loan

= $500,000

Putting the values above in the formula:

= $1,540,000 - $500,000

= $1,040,000