Hape Enterprises have been in the textile industry for ten years. The owner of Hape Enterprises is Mr. Joe. He started the business as a bachelor with ₦10,000. As at 31 August 2018, the total assets of the Company amount to ₦5,700,000. The total liabilities are ₦1,421,210.
Required: Advise Mr. Joe on the net worth of his business as at 31 August 2018.
A suggested solution to practice activity 4.2
The net worth of Hape Enterprises as at 31 August 2018 is:
Assets minus Liabilities
Assets = ₦5,700,000
Liabilities = ₦1,421,210
Therefore, the net worth of Hape Enterprises as at 31 August 2018 is:
₦5,700,000 - ₦1,421,210
= ₦4,278,790
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