Dr. Jay is opening an emergency vet service within his community in January. He invested $425,000 cash into the business. Dr. Jay bought vet supplies, equipment, vet software, and office equipment for $200,000.

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Topic: Accounting Posted 1 year ago

Dr. Jay is opening an emergency vet service within his community in January. He invested $425,000 cash into the business. Dr. Jay bought vet supplies, equipment, vet software, and office equipment for $200,000.

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Koala Tutor

Oct 9, 2023

Koala Ai Support

Total owner's equity is calculated by subtracting liabilities from the total assets.

The total assets include the cash investment and the cost of equipment and supplies:
$425,000 cash investment + $200,000 equipment and supplies = $625,000 total assets

The liabilities include the long-term loan:
$50,000 long-term loan

Total owner's equity:
Total assets - liabilities = $625,000 - $50,000 = $575,000

Therefore, Dr. Jay's total owner's equity is $575,000.

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