Question

holden owns a restaurant. his assets include $6,500 in cash, $2,400 in inventory, $8,000 in equipment, and $15,000 for a delivery vehicle. his liabilities include a $3,500 credit card balance, $2,200 in bank loans, and $12,500 in mortgage payments for the restaurant. what is holdens equity?

$13,900
$13,700
$14,100
$13,500

Explanation:

Step1: Calculate total assets

To find total assets, we sum up all of Holden's assets. His assets are $6,500 (cash), $2,400 (inventory), $8,000 (equipment), and $15,000 (delivery vehicle). So the total assets are $6,500 + $2,400 + $8,000 + $15,000.
$$6500 + 2400 + 8000 + 15000 = 31900$$

Step2: Calculate total liabilities

Next, we sum up all of Holden's liabilities. His liabilities are $3,500 (credit card balance), $2,200 (bank loans), and $12,500 (mortgage payments). So the total liabilities are $3,500 + $2,200 + $12,500.
$$3500 + 2200 + 12500 = 18200$$

Step3: Calculate equity

Equity is calculated as total assets minus total liabilities. So we subtract the total liabilities from the total assets.
$$31900 - 18200 = 13700$$

Answer:

$13,700$