Assets = Liabilities + Owners' Equity

The following excercise should aid in understanding The Accounting Equation. Please answer the questions below and proceed by clicking the Check My Answers button located at the bottom of the page.

1.	A share of stock in General Motors that your company owns would be:
			A liability
			Owners' equity
			An asset
			None of the above
			All of the above
2.	A company has $1,000,000 Owners' Equity and $75,000 in liabilities. What are the assets for the company?
			$1,000,000
			$75,000
			$925,000
			None of the above
3.	A company has cash in the bank of $850,000, inventory of $50,000 and a building worth $100,000. These are the only assets for the company. The company has liabilities that amount to $925,000. How much is owners' equity in this company?
			$1,000,000
			$75,000
			$925,000
			None of the above
4.	Which of the following is not an asset:
			Retained earnings
			A roto-tiller
			A stapler
			20 kilos of fertilizer
			All of the above