Answer to Question #281210 in Accounting for mack

Question

How is the equity value of a business calculated considering only the accounts in the owner's equity section of the trial balance? 

Answer 1

Solution:

Equity value refers to the owner’s ownership in the business, that is, the net business assets owned by the business owner.

The value of an owner's equity is calculated by adding all of the company's assets and subtracting all of its liabilities.

Owner’s equity value = Total assets – Total liabilities