Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

12. Stockholders' Equity

Retained Earnings

Financial Accounting

12. Stockholders' Equity

Retained Earnings

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Multiple Choice

Which of the following best describes the owner's rights to the assets of a business after all liabilities have been paid?

Retained Earnings

Total Assets

Owner's Equity

Revenue

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Verified step by step guidance

Understand the question: The problem is asking about the owner's rights to the assets of a business after all liabilities have been paid. This is a fundamental concept in accounting related to the accounting equation.

Recall the accounting equation: The basic accounting equation is Assets = Liabilities + Owner's Equity. Rearranging this equation, Owner's Equity = Assets - Liabilities. This shows that the owner's equity represents the residual interest in the assets after liabilities are settled.

Analyze the options: Retained Earnings is a part of Owner's Equity but does not represent the entirety of it. Total Assets include both liabilities and equity, so it does not directly represent the owner's rights. Revenue is an income statement account and does not directly describe the owner's rights to assets.

Identify the correct term: Owner's Equity is the term that best describes the owner's rights to the assets of a business after all liabilities have been paid. It represents the net worth of the business attributable to the owner(s).

Conclude: The correct answer is Owner's Equity, as it aligns with the definition and the accounting equation.