Question

question 10

___________ shows the ownership right of the proprietor or partners in a business.

a capital accounts
b purchase title
c owners equity
d net assets

Explanation:

🆕 New Concept Discovered: Accounting Equation Components
The core elements representing ownership, assets, and liabilities.

Step 1: Analyze the definition in the question

The question asks for the term that represents the "ownership right of the proprietor or partners in a business."

In accounting, this represents the owner's residual interest in the assets of the business after deducting all liabilities. It is the claim that the owners have on the assets of the institution.

Step 2: Evaluate the options

• A - Capital accounts: These are specific accounts used to record the individual investments and withdrawals of the owners, but they are a subset/component of the broader category representing overall ownership rights.
• B - Purchase title: This is a legal document proving ownership of a specific purchased asset, not a general accounting term for business ownership interest.
• C - Owner's equity: This is the standard accounting term that represents the owner's total financial interest or ownership rights in a sole proprietorship or partnership.
• D - Net assets: While mathematically equivalent to owner's equity (\(\text{Assets} - \text{Liabilities} = \text{Net Assets}\)), "Owner's equity" is the term specifically defined as the ownership interest of the proprietor or partners.

Therefore, the most direct and standard term for the ownership right of a proprietor or partners is Owner's equity.

Answer:

C Owner's equity