This equation is also the basis for the most basic of accounting reports, the aptly named Balance Sheet. A balance sheet reports what a business owns (assets), what it owes (liabilities) and what remains for the owners (equity) as of a certain date. This equation must always be in balance. Always keep in mind the teeter totter illustration shown above.
|
Scooped by
Peter John Baskerville
onto Basic Accounting Concepts October 23, 2011 5:01 PM
|