Chapter 1, Problem 13Q

To determine

Assets:

Assets are the resources owned by a business to carry out production and sales activities. The assets are associated with a future economic value that can be expressed in terms of monetary values. All the assets are meant to provide future services or benefits. For example, cash, accounts receivable, land, buildings, equipment, vehicles, and investments all come under the assets section.

Liabilities:

Liabilities are the legal obligations against assets that are to be fulfilled in the future. They can also be defined as the debts that arise during the performance of various activities. Most of the businesses borrow money or buy goods and services from a supplier on credit. This incurs a future obligation on the businesses, which is to be fulfilled in the future. For example, notes payable, interest payable, accounts payable, salaries, and wages payable all come under the liabilities section.

Stockholders’ Equity:

The amount invested to a business by its shareholder or the donated capital and earnings from operations less any dividends issued gives the stockholders’ equity. The stockholders’ equity gives the ownership claim on the total assets of a business. The amount left after satisfying the creditors, belongs to the stockholders’ claim on the assets. It also includes common stock and retained earnings.

To identify: The items that are liabilities of jewelry stores.