Question

Assets: $ 43,000
Liability: ?
Stock: $6,000
Net Income (loss): $9650
Cash Dividends: $3500

This is how to calculate it...
Assets = Liabilities + Equity
Equity = Stock + Net Income - Dividends

Please show work. I keep getting a negative and a wrong answer. Please help

Answer 1

Equity = 6000+9650-3500 = $12,150
Assets = liabilities + equity
or, 43,000 = liabilities + 12,150
or, Liabilities = 43,000 - 12,150 [by changing the side]
or, liabilities = $ 30,850

So simple, you probably made error in changing sign in time of changing the side.