MANAGEMENT

Detailed explanation-1: -Assets are everything your business owns. Liabilities and equity are what your business owes to third parties and owners. To balance your books, the golden rule in accounting is that assets equal liabilities plus equity.

Detailed explanation-2: -Assets = Liabilities + Shareholders’ Equity.

Detailed explanation-3: -You can calculate it by deducting all liabilities from the total value of an asset: (Equity = Assets – Liabilities). In accounting, the company’s total equity value is the sum of owners equity-the value of the assets contributed by the owner(s)-and the total income that the company earns and retains.

Detailed explanation-4: -What Are the 3 Elements of the Accounting Equation? The three elements of the accounting equation are assets, liabilities, and shareholders’ equity. The formula is straightforward: A company’s total assets are equal to its liabilities plus its shareholders’ equity.

Detailed explanation-5: -The accounting equation is a formula that shows the sum of a company’s liabilities and shareholders’ equity are equal to its total assets (Assets = Liabilities + Equity).