What is total stockholders' equity?
Understand the Problem
The question is asking for the definition and understanding of total stockholders' equity, which is a financial term that represents the net assets owned by the stockholders of a company.
Answer
The total value of assets owned by shareholders after all liabilities have been settled.
The final answer is the total value of assets owned by shareholders after all liabilities have been settled.
Answer for screen readers
The final answer is the total value of assets owned by shareholders after all liabilities have been settled.
More Information
Stockholders' equity, also known as shareholders' equity, represents the residual assets shareholders would receive after a company's liabilities have been paid. It can be calculated using the formula: Total Assets - Total Liabilities.
Tips
A common mistake is confusing stockholders' equity with company profits. While related, they are different concepts. Ensure that all liabilities are accounted for correctly when calculating equity.
Sources
- What Is Shareholder Equity (SE) and How Is It Calculated? - investopedia.com
- Stockholders Equity and How Is It Calculated? - finance.yahoo.com
- What Is Stockholders' Equity? Definition and Formula - indeed.com
