Question

Sankey, Inc., has current assets of $5,200, net fixed assets of $25,200, current liabilities of $4,250, and long-term debt of $9,400. (Do not round intermediate calculations.) What is the value of the shareholders' equity account for this firm?

Answer 1

$

Net fixed assets 25,200

Current assets 5,200

Total assets 30,400

Current liabilities (4,250)

Long-term debt (9,400)

Net assets 16,750

The value of shareholders' equity is $16,750, which corresponds to the net assets of the firm.

Step-by-step explanation:

The value of shareholders' equity equals total assets minus total liabilities. The total assets amounted to $30,400 while the total liabilities are $13,650. The difference between total assets and total liabilities gives the net assets, which equals shareholders' equity.

Answer 2

$16,750

Step-by-step explanation:

Using the accounting equation

Assets - liabilities = Equity

Total assets = $5,200 + $25,200

= $30,400

Total liabilities = $4,250 + $9,400

= $13,650

Shareholders' equity = $30,400 - $13,650

= $16,750