The following is a summary of the asset and liabilities of Ojo trading company as at 31st December, 2018<br/>Initial Capital = 5000<br/>Net Profit = 1000<br/>Furniture = 2000<br/>Equipment = 2900<br/>Debtors = 100<br/>Stock = 1000<br/>Bank = 500<br/>From the above, calculate Current liabilities
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Correct Answer: Option C
Explanation:
Using the accounting equation:<br/><br/>Assets = Capital + Liabilities<br/><br/>Total assets = 4,900 + 1,600<br/>= N6,500.<br/><br/>Capital = Initial Capital + Net Profit<br/>= 5,000 + 1,000<br/>= N6,000.<br/><br/>Liabilities = Assets - Capital<br/>= 6,500 - 6,000<br/>= N600.<br/><br/>Therefore, the current liabilities are N600
Using the accounting equation:<br/><br/>Assets = Capital + Liabilities<br/><br/>Total assets = 4,900 + 1,600<br/>= N6,500.<br/><br/>Capital = Initial Capital + Net Profit<br/>= 5,000 + 1,000<br/>= N6,000.<br/><br/>Liabilities = Assets - Capital<br/>= 6,500 - 6,000<br/>= N600.<br/><br/>Therefore, the current liabilities are N600