PRC-1 · Chapter 1 · Question 21 of 100
If 25% of the total assets of 'Nexus Logistics' are financed by liabilities, and the total assets amount to Rs. 250,000, what is the total amount of the owner's equity?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Rs. 187,500
Explanation
If total assets are Rs. 250,000 and liabilities finance 25% (Rs. 62,500), then according to the accounting equation (Assets = Liabilities + Equity), Equity is Rs. 250,000 - Rs. 62,500 = Rs. 187,500.
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