Question

what is the liability?
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

If your equations are

Assets = Liabilities + Equity
Equity = Stock + Net Income - Dividends

You substitute the equation for Equity into the first equation, so Assets becomes

Assets = Liabilities + (Stock + Net Income - Dividends)

Plugging in the values for each we get

43000 = Liabilities + (6000 + 9650 - 3500)

Can you solve from here, and what did you get??