Question

Midyear on july 31st, the digby corporation's balance sheet reported: total liabilities of $51.391 million total common stock of $2.540 million cash of $4.020 million retained earnings of $18.432 million. what were the digby corporation's total assets? select: 1

Answer 1

We can calculate total assets by accounting equation, which is total assets equal to total liabilities plus total equity. Using the basic accounting equation:

Total assets = Total liabilities + shareholders’ equity

= total liabilities + ( total common stock + Retained earnings)

= $51.391 million + ($2.540 million + 18.432 million)

= $72.363 million

Therefore, total assets of the firm would be $72.363 million.