ACCOUNTING AND FINANCIAL ENGINEERING - EXAMPLE 34.11 : Let an Accounting Equation to be : Assets = Liabilities + Equity of Owner. In a biochemical engineering organization, its account balance sheet contains the following information : Accounts payable $2200; accounts receivable $1500; line of credit $500; cash $100; long term debt $3800; inventory $1300; investments $800; plant equipment $6800. Find the equity of owner by applying Accounting Equation.
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ACCOUNTING AND FINANCIAL ENGINEERING - ANSWER 34.11 : Total asset = accounts receivable $1500 + cash $100 + inventory $1300 + investments $800 + plant equipment $6800 = $10500. Total liabilities = accounts payable $2200 + line of credit $500 + long term debt $3800 = $6500. Equity of owner = total assets - total liabilities = $10500 - $6500 = $4000. The answer is given by Kang Chuen Tat; PO Box 6263, Dandenong, Victoria VIC 3175, Australia; SMS +61405421706; chuentat@hotmail.com; http://kangchuentat.wordpress.com.
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