Which of the following components is necessary to calculate Owner's Equity?

To determine Owner's Equity, the formula used in accounting is fundamentally derived from the accounting equation, which states that Assets equal Liabilities plus Owner's Equity. Rearranging this equation leads to the understanding that Owner's Equity can be calculated by subtracting Liabilities from Assets. Essentially, Owner's Equity represents the residual interest in the assets of the business after deducting liabilities, and this is why the formula Assets - Liabilities is requirements. This calculation gives a clear picture of what is owned by the owners of a business after all debts have been accounted for, making it a crucial component of financial analysis for any business.

In contrast, the other options do not accurately represent the necessary calculation for determining Owner's Equity. Sales Revenue minus Cost of Goods Sold is used to calculate Gross Profit, while Net Profit plus Tax Obligations doesn't relate to Owner's Equity directly. Finally, adding Total Assets to Liabilities does not contribute to understanding the equity position, as it deviates from the standard accounting equation.