Asked by Alyssa E McVey on Jun 16, 2024
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The accounting equation states that total Assets must always equal total Liabilities plus Owner's Equity.
Owner's Equity
The total assets minus total liabilities of an individual owner in a business, representing the owner's residual interest in the company.
Liabilities
The financial obligations or debts of a business entity, which are settled over time through the transfer of economic benefits including money, goods, or services.
Assets
Resources owned or controlled by a business, individual, or entity that are expected to provide future economic benefits.
- Gain an understanding of the basic accounting equation's components and their practical applications.
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Learning Objectives
- Gain an understanding of the basic accounting equation's components and their practical applications.
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