To calculate the owner's equity for XYZ Company, we need to follow these steps:
1. Calculate Total Assets:
- Cash: \[tex]$34,000
- Inventory: \$[/tex]23,000
- Property: \[tex]$98,000
Add these amounts to get the total assets.
\[
\text{Total Assets} = \$[/tex]34,000 + \[tex]$23,000 + \$[/tex]98,000 = \[tex]$155,000
\]
2. Calculate Total Liabilities:
- Notes: \$[/tex]31,000
- Wages: \[tex]$42,000
Add these amounts to get the total liabilities.
\[
\text{Total Liabilities} = \$[/tex]31,000 + \[tex]$42,000 = \$[/tex]73,000
\]
3. Determine Owner's Equity:
- We are given stock (\[tex]$45,000) and investment (\$[/tex]37,000) which needs to be subtracted from the total assets after accounting for the liabilities.
First, subtract the total liabilities from the total assets:
[tex]\[
\text{Total Assets} - \text{Total Liabilities} = \$155,000 - \$73,000 = \$82,000
\][/tex]
Then, subtract the stock and investment from this result:
[tex]\[
\text{Owner's Equity} = \$82,000 - \$45,000 - \$37,000 = \$0
\][/tex]
Therefore, the owner's equity for XYZ Company is \$0.
