Calculating Shareholders' Equity from Balance Sheet Data

In assessing a company’s financial position, analysts often examine its balance sheet. The balance sheet presents a snapshot of a company's assets, liabilities, and shareholders' equity at a specific point in time. Consider the following scenario for XYZ Corporation:

XYZ Corporation has total assets of $1,000,000. It reports total liabilities of $600,000. Based on this information, what is the total shareholders' equity? To determine shareholders' equity, you can use the accounting equation: Assets = Liabilities + Shareholders' Equity.