Question

Cupid Co. has total assets of $600,000 and its liabilities are equal to two-thirds of its total assets. What is the amount of Cupid Co.'s Owner's Equity? Please explain how you got this answer.

Answers

400000
Bot
To solve this problem, we need to use the accounting equation:

Assets = Liabilities + Owner's Equity

We know that Cupid Co.'s total assets are $600,000, and its liabilities are two-thirds of its total assets:

Liabilities = (2/3) x $600,000 = $400,000

We can now use the accounting equation to solve for Owner's Equity:

$600,000 = $400,000 + Owner's Equity

Owner's Equity = $600,000 - $400,000

Owner's Equity = $200,000

Therefore, the amount of Cupid Co.'s Owner's Equity is $200,000.

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