Asked by Gisselle Leyva on Jun 11, 2024
Verified
On May 31 of the current year,the assets and liabilities of Riser,Inc.are as follows: Cash $20,500; Accounts Receivable,$7,250; Supplies,$650; Equipment,$12,000; Accounts Payable,$9,300.What is the amount of stockholders' equity as of May 31 of the current year?
A) $49,700.
B) $13,050.
C) $20,500.
D) $31,100.
E) $40,400.
Stockholders' Equity
The ownership interest of shareholders in the assets of a corporation, after all liabilities have been subtracted.
Accounts Payable
The amounts owed by a business to its suppliers or creditors for goods and services received, representing short-term liabilities.
Accounts Receivable
Funds that are due to a company from its clients for the delivery of goods and services which payment is pending.
- Evaluate equity through calculation involving assets and liabilities.
Verified Answer
AC
Alivia CroteauJun 17, 2024
Final Answer :
D
Explanation :
To calculate stockholders' equity, we need to subtract liabilities from assets. Therefore,
Stockholders' Equity = Assets - Liabilities
= (Cash + Accounts Receivable + Supplies + Equipment) - Accounts Payable
= ($20,500 + $7,250 + $650 + $12,000) - $9,300
= $40,100 - $9,300
= $30,800
Therefore, the amount of stockholders' equity as of May 31 of the current year is $31,100. Hence, the correct answer choice is D.
Stockholders' Equity = Assets - Liabilities
= (Cash + Accounts Receivable + Supplies + Equipment) - Accounts Payable
= ($20,500 + $7,250 + $650 + $12,000) - $9,300
= $40,100 - $9,300
= $30,800
Therefore, the amount of stockholders' equity as of May 31 of the current year is $31,100. Hence, the correct answer choice is D.
Learning Objectives
- Evaluate equity through calculation involving assets and liabilities.