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Question

If total assets of a business are Rs. 1,80,000 and total outside liabilities are Rs. 50,000, the net worth of the firm will be ___________.

A
Rs. 1,30,000
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B
Rs. 2,30,000
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C
Rs. 1,80,000
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D
Rs. 50,000
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Solution

The correct option is B Rs. 1,30,000
Accounting Equation:

Owners Equity+Outside liabilities=Total Assets
Owners Equity=Net Worth

Owners Equity/Net Worth+Rs.50000=Rs.180000

Hence Net Worth of the firm will be Rs.130000

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