Question

On May 31 of the current year, the assets and liabilities of Riser, Inc. are as follows: Cash $27,000; Accounts Receivable, $7,950; Supplies, $1,300; Equipment, $12,700; Accounts Payable, $10,050. What is the amount of equity as of May 31 of the current year?

Answer 1

Answer:

The amount of equity as at May 31 of the current year is $38,900

Explanation:

In this question, we are asked to calculate the amount of equity as of May 31st of Riser Inc given the list and values of its liabilities and assets. We use a mathematical approach.

Mathematically,

Assets = Liabilities + Stockholders' Equity

Cash + Accounts Receivable + Supplies + Equipment = Accounts Payable + Stockholders' Equity

$27,000+ $7,950+ $1,300+ $12,700= $10,050+ Stockholders' Equity

$48,950= $10,050+ Stockholders' Equity

Stockholders' Equity = $48,950 - $10,050

Stockholders' Equity = $38,900