Question

PLEASE HELPPP!!!!
Emily has decided to close her business and sell off her assets. Her Capital balance before liquidation
is $30000. Assets valued at $35000 were sold for $16000 in cash. The total liabilities of $5000 were
paid in full. She paid the liquidator $1000. After liquidation of her assets and liabilities, what would
be Emily's Capital balance? Explain your answer by showing your calculations?

Answer 1

Emily's Capital balance is $10,000

Capital can be defined a the assets which a business owner own in a business such as:

•Machinery

•Cash

•Land and Building

•Factory Equipment

•Office Equipment.

•Account Receiveble

Using this formula

Capital Balance=Assets - Liabilities

Where:

Assets=$16,000

Liabilities=$5,000+$1,000=$6,000

Let plug in the formula

Capital Balance=$16,000-($5,000+$1,000)

Capital Balance=$16,000-$6,000

Capital Balance=$10,000

Inconclusion Emily's Capital balance is $10,000.

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