Question

Claims against the assets of a business firm is called

• A. Owners equity
• B. Outsiders equity
• C. Total equity
• D. Capital

Answer 1

Answer:

C. Total equity

Claims against the assets of a business firm can come from: Owners – called Capital / Owners’ Equity Creditors / outsiders – called Outsiders’ Equity / Liabilities Therefore, claims by outsiders (like creditors, suppliers, banks) on the firm’s assets are referred to as Outsiders’ Equity. Other options: Owners’ Equity / Capital: Claim of owners, not outsiders. Total Equity: Sum of owners’ and outsiders’ claims (not specific).