Question

When reviewing the balance sheet for Portable Pet Care, Inc., a mobile small animal care business, Ricky noted the following information: Company assets totaling $3.5 million, and liabilities totaling $1.3 million. On paper, the net worth (owners' equity) for this business _________.

Answer 1

$2.2 million

Step-by-step explanation:

Given that

Total asset = 3.5 million

Total liabilities = 1.3 million

Recall that,

Networth (owner's or shareholder's equity) = Total asset - Total liabilities

Therefore

Networth = 3.5 million - 1.3 million

= 2.2 million

Thus,

Owner's equity for this business on paper is $2.2 million based on info provided.

Answer 2

Answer: $2.2 Million

Step-by-step explanation:

In fundamental accounting equation:

Assets - Liabilities = Owners' equity. On the balance sheet, owner equity is the same as net worth.