Question

Luce pasios is setting up a new business before actualy selling anything,he bought a van for $13000,a transporatable market stall for $1050,an inventory of goods for $8000.He did not pay in full for his inventory of goods & still owes $35000 for them.He borrowed $10000 from Brazil yomey.After the events just describe and before trading starts,he has $1400 cash in hand $4700 in the bank.Calculate the amount of his ''capital''.

Answer 1

Luce Pasios' capital is calculated by subtracting his total liabilities from his total assets, which results in $14,650.

Step-by-step explanation:

To calculate Luce Pasios' capital, we need to consider the assets and liabilities he has before trading starts. Capital is defined as the amount of assets that exceed liabilities. We can use the following equation:

Capital = Assets - Liabilities

First, we determine the total assets:

• Van: $13,000
• Market stall: $1,050
• Inventory of goods: $8,000
• Cash in hand: $1,400
• Cash in bank: $4,700

Total Assets = $13,000 + $1,050 + $8,000 + $1,400 + $4,700 = $28,150

Then, we calculate total liabilities:

• Money owed for inventory: $3,500
• Loan from Brazil Yomey: $10,000

Total Liabilities = $3,500 + $10,000 = $13,500

Now we subtract the total liabilities from the total assets to determine Luce Pasios' capital:

Capital = Total Assets - Total Liabilities

Capital = $28,150 - $13,500 = $14,650