The following items appear in a Statement of Financial Position: Receivables Euro 200,000 Payables Euro 350,000 Inventory Euro 100,000 Non-current assets Euro 750,000 Long-term loan Euro 400,000 What is the balance of Shareholders' funds (SH Equity)?

Accounting Dec 16, 2020

The following items appear in a Statement of Financial Position:

Receivables	Euro 200,000
Payables	Euro 350,000
Inventory	Euro 100,000
Non-current assets	Euro 750,000
Long-term loan	Euro 400,000

What is the balance of Shareholders' funds (SH Equity)?

Expert Solution

Let us use the accounting equation to find the answer:

Total Assets		Total Liabilities
Receivables	Euro 200,000	Payables	Euro 350,000
Inventory	Euro 100,000	Long-term loan	Euro 400,000
Non-current assets	Euro 750,000
Total	Euro 1,050,000	Total	Euro 750,000

Shareholders' funds = total assets - total liabilites = Euro 1,050,000 - Euro 750,000 = Euro 300,000

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