Shareholders' equity:

a. is equal to total assets plus total liabilities.
b. decreases whenever new shares of stock are issued.
c. represents the residual value of a firm.
d. includes long-term debt, preferred stock, and common stock.
e. increases in value anytime total assets increases.

The residual value of a firm is the value of firm's all asset after paying all liabilities of the firms. It is also known as the net worth of the firm.

Example:

Total Asset of the firm = $100,000

Total Liabilities of the firm = $45,000

Accounting Equation:

Assets = Equity + Liabilities

Equity = Assets - Liabilities

So

Residual value = Total Asset of the firm - Total Liabilities of the firm

Residual value = $100,000 - $55,000

Residual value / Equity = $55,000

Shareholders' equity: a. is equal to total assets plus total liabilities. b. decreases whenever new shares of stock are issued. c. represents the residual value of a firm. d. includes long-term debt, preferred stock, and common stock. e. increases in value anytime total assets increases.

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Shareholders' equity:

a. is equal to total assets plus total liabilities.
b. decreases whenever new shares of stock are issued.
c. represents the residual value of a firm.
d. includes long-term debt, preferred stock, and common stock.
e. increases in value anytime total assets increases.