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At the end of the month, Maria Clara Parlor's total Liabilities and Owner's Equity is P 250,000. One fifth of which is the liability. The parlor's total assets isSelect one:a.P 250, 000b.Answer not givenc.P 200, 000d.P 50, 000

Question

At the end of the month, Maria Clara Parlor's total Liabilities and Owner's Equity is P 250,000. One fifth of which is the liability. The parlor's total assets isSelect one:a.P 250, 000b.Answer not givenc.P 200, 000d.P 50, 000

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Solution

The total liabilities and owner's equity of Maria Clara Parlor is P 250,000. If one fifth of this amount is the liability, then the liability would be P 50,000 (250,000 divided by 5).

The Accounting Equation is: Assets = Liabilities + Owner's Equity.

If we subtract the liabilities from the total liabilities and owner's equity, we get the total assets.

So, 250,000 (total liabilities and owner's equity) - 50,000 (liabilities) = P 200,000.

Therefore, the parlor's total assets is P 200,000.

So, the correct answer is c. P 200,000.

This problem has been solved

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