Accounting Equation

If a company's total assets are P50,000 and its total liabilities are P20,000, what is the owner's equity?

• P70,000

• P30,000

• P20,000

• P50,000

A business purchases inventory worth P3,000 on credit. How does this transaction affect the accounting equation?

• Assets increase by P3,000; Liabilities increase by P3,000

• Assets increase by P3,000; Equity decreases by P3,000.

• Assets decrease by P3,000; Liabilities decrease by P3,000.

• Assets increase by P3,000; Equity increases by P3,000.

If a company's total liabilities are P25,000 and its owner's equity is P40,000, what is the total value of its assets?

• P15,000

• P65,000

• P25,000

• P40,000

A business owner invests P100,000 of personal savings into his milk tea business. How does this transaction affect the accounting equation?

• Assets increase by P100,000; Liabilities decrease by P100,000.

• Assets increase by P100,000; Equity increases by P100,000.

• Assets decrease by P100,000; Equity increases by P100,000.

• Assets increase by P100,000; Liabilities increase by P100,000.

If a company's total assets are P120,000, and its owner's equity is P80,000, what is the total value of its liabilities?

• P40,000

• P200,000

• P80,000

• P120,000