Question

you are examining the year-end balance sheet for your business. according to the information in the balance sheet, what is your equity in the business? balance sheet for year ending december 31 assets cash: $10,000 inventory: $2,000 equipment: $5,000 total assets: $17,000 liabilities credit card balance: $2,500 long-term debt: $0 unearned revenues: $3,500 total liabilities: $6,000 $17,000 $7,000 $10,000 $11,000

Explanation:

Step1: Recall the accounting equation

The basic accounting equation is \( \text{Equity} = \text{Assets} - \text{Liabilities} \).

Step2: Identify total assets and total liabilities

From the balance sheet, Total Assets = \$17,000 and Total Liabilities = \$6,000.

Step3: Calculate equity

Substitute the values into the equation: \( \text{Equity} = 17000 - 6000 = 11000 \).

Answer:

\$11,000