Question

Based on the accounts reflected below, the missing value for Equipment for the fundamental accounting equation to be in balance is what amount? Assume that all accounts have normal balances.

Cash—$30,800

Accounts Payable—$20,000

Jack Carter, Capital—$60,000

Equipment—$XX,XXX

Supplies—$9,20

Answer 1

The missing value for Equipment in the fundamental accounting equation is $40,000, calculated by using the formula: Equipment = (Accounts Payable + Owner's Equity) - (Cash + Supplies).

Step-by-step explanation:

To find the missing value for Equipment in the fundamental accounting equation, we need to make sure that the equation Assets = Liabilities + Owner's Equity is balanced. The accounts provided are:

• Cash - $30,800
• Supplies - $9,200
• Accounts Payable - $20,000 (Liability)
• Jack Carter, Capital - $60,000 (Owner's Equity)
• Equipment - $XX,XXX (the unknown we need to solve for)

The accounting equation can be rearranged to solve for the unknown:

Assets = Liabilities + Owner's Equity

Equipment + Cash + Supplies = Accounts Payable + Jack Carter, Capital

Equipment = (Accounts Payable + Jack Carter, Capital) - (Cash + Supplies)

Plugging in the values:

Equipment = ($20,000 + $60,000) - ($30,800 + $9,200)

Equipment = $80,000 - $40,000

Equipment = $40,000

The missing value for Equipment for the accounting equation to balance is $40,000.