On May 31 of the current year, the assets and liabilities of Riser, Inc. are as follows: Cash $25,500; Accounts Receivable, $7,800; Supplies

On May 31 of the current year, the assets and liabilities of Riser, Inc. are as follows: Cash $25,500; Accounts Receivable, $7,800; Supplies, $1,150; Equipment, $12,600; Accounts Payable, $9,850. What is the amount of equity as of May 31 of the current year?

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  1. Answer:

    $37,200

    Explanation:

    In the balance sheet, the assets, liabilities, and stockholder equity is recorded. In this the accounting equation is used which is shown below:  

    Total assets = Total liabilities + stockholder equity

    where,

    Total assets = Cash + accounts receivable + supplies + equipment

                        = $25,500 + $7,800 + $1,150 + $12,600

                        = $47,050

    And, the total liabilities is equal to the account payable i.e $9,850

    So, the stockholder equity would be

    = $47,050 – $9,850

    = $37,200

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