Which of the following is not a proper form of the accounting equation
FINANCIAL
JAMB 2015
Which of the following is not a proper form of the accounting equation
- A. fixed assets + current assets - liabilities = capital
- B. fixed assests + current assests + liabilities = capital
- C. fixed assets
- D. fixed asset + current asset
Correct Answer: B. fixed assests + current assests + liabilities = capital
Explanation
The simplest presentation of capital employed is total assets minus current liabilities. Sometimes, it is equal to all current equity plus interest-generating loans (non-current liabilities).
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