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# How to find liability and equity if only given assets and net income?

Asked Sep 19, 2010, 02:34 PM — 25 Answers
I am given assets: 36,000. Liability: ? Equity: ?

Also am given
Stock issuances.. 6000
Dividends... 3500
Net income... 7760

How am I suppose to set this up thanks.

25 Answers
 pready Posts: 2,987, Reputation: 1016 Ultra Member #2 Sep 19, 2010, 04:42 PM

First you need to find equity.
Stock plus Net Income minus Dividends equals Owners' Equity.

With Assets and Owners' Equity you can now get Liabilities.

Liabilities equals Assets minus Owners' Equity.
 vtfiveoneo Posts: 2, Reputation: 10 Junior Member #3 Sep 19, 2010, 05:35 PM
Thanks one more question how about this:

08:
Assets: 21,120
Liabilities: 11,404

09:
Assets: ?
Liability: 11,818

Stock insurances: 9750
Net income : -1289
Dividends: 5875
 morgaine300 Posts: 6,564, Reputation: 1474 Uber Member #4 Sep 20, 2010, 01:48 AM

This is all related:

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

Solve for 08 equity using the equation. Make the changes in equity using the bottom info to get the 09 number. Plug that into the equation to solve for asset.

You can solve any of these kinds of problems with this. The only difference between this and your first problem is that you will have a beginning balance in equity to add.
 SLYF3R Posts: 2, Reputation: 10 Junior Member #5 Oct 26, 2010, 12:44 AM
Can You Help Me With Please ? I Am New To Accounting.

Im Looking For How To Get The Liability.

Assets = 113000

Owner Investments = 6500
Net Income = 20000
Owner Cash Withdrawl = 11000

Can You Help Me Understand The Formula ? Please.

Thanks
 pready Posts: 2,987, Reputation: 1016 Ultra Member #6 Oct 26, 2010, 09:56 AM

You have the assets and the information needed to get the Onwers Equity.

Onwers Equity = Onwer Investments + Net Income - Owner Withdrawl's

Now you have assets and Equity, so you can figure out liabilities.

Liabilities = Assets - Owners Equity
 SLYF3R Posts: 2, Reputation: 10 Junior Member #7 Oct 26, 2010, 10:24 AM
Hi

Thanks For Trying To Help BUT It Still Doesn't Match What Is In The Textbook.. These Numbers Don't Add Up

In My Book..

Assets = 113,000
Liabilities = 70000

Owner Investments = 6500
NetIncome = 20000
Owner Withdrawals = 11000

I Didn't Tell You The Liabilities Before Because I Was Trying To See If Your Method Would Give Out The Liabilities That's In The Book

Doesn't The Numbers Have To Add Up ?

I Did 6500 + 20000 - 11000 = 15500

Liabilities = 113000 - 15500 = 97500.. Not Close To 70000

Also.. How Would You Figure Out Liabilites And Equity When You Only Have Assets ?

Thank You.
 pready Posts: 2,987, Reputation: 1016 Ultra Member #8 Oct 26, 2010, 02:52 PM

Assets = Liabilities + Owners Equity

Therefore Owners Equity = Assets - Liabilities

From your previous problem you did not include retained earnings which would account for the difference.

If you only have assets you will not be able to figure out liabilities and owners equity without additional information to compute either liabilities or owners equity.
 lin522 Posts: 1, Reputation: 1 New Member #9 Apr 1, 2012, 04:12 PM
How do I solve for: What is the amount of Liabilitiy?

As of Dec 31, 2011
Assets = 43,000
Liabilities = ?
During year 2011
Onwer Investments = 6,000
Net Income (loss) = 9650
Owner cash withdrawals = 3500
 pready Posts: 2,987, Reputation: 1016 Ultra Member #10 Apr 1, 2012, 07:15 PM
Owners Investments + Net Income - Owners Withdrawals = Equity

Assets - Equity = Liabilities

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