Answer:
Book value of equity = $400
Explanation:
The book value of equity is also known as the the net asset value . It is determined by subtracting the total book value ( as stated in the books in historical costs) of liabilities from the the total book value of assets.
Net Asset = Total assets - total liabilities
Net assets = $500 + $200 - $300
Net Asset = $400
Book value of equity = $400
Note that the current assets was not added because the net working capital is the current assets less current liabilities. So to include the current assets would mean double counting.
