A business has: Land $1,000,000, Machinery $20,000, Cash $10,000, Debt $0. find the value of the owner’s equity?

The owner equity is equal to Net Assets i.e. Total Assets less Liabilities. In this case it is1,030,000 (D).

 

option no4------------------------------------------------------

Agree with experts` answers

Equity = Total assets less all outside liabilities 

1000000+10000+20000-0=1030000

4. $1,030,000 is the correct answer.

 

The correct answer is :4 $1,030,000

As you are familiar the basic accounting equation is Assets = Equities. You are also familiar that the term equity comprises the creditor's equity and the owner's equity. So, if there is no liability(creditor's equity), then simply you know that asset = owner's equity which is :1000,000 + $20,000 + $10,000

E = A-L

So..

1030,000 =1,000,000 +20,000 +10,000 -0

Correct ans is4

My answer is (4) $1,030,000.

 

Owner’s equity is the residual amount after deducting liabilities from assets. Since liability is zero, total assets equals owner’s equity.

Option4 is the right answer.

Total Assets less Total liabilities = Net Assets Correct option is option4