Multiple choice

Which of the following reveals the relation between capital, assets and liabilities?

  1. Capital = Assets - Liabilities

  2. Capital = Assets + Liabilities

  3. Assets = Liabilities - Capital

  4. Liabilities = Capital + Assets

  5. None of these

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Correct; capital invested is always the subtraction of liabilities from assets.