Assets, Liabilities & Equity Explained

👉 Confused by accounting? Download this free cheat sheet: https://accountingstuff.com Assets, Liabilities and Equity are connected by a formula called the Accounting Equation. It says that Assets are equal to Liabilities plus Equity. But what does this mean? On the left, we have Assets. These represent the stuff that a business owns. And on the right, we have Liabilities and Equity. Liabilities are what a business owes to external parties, and Equity is what the business owes to its owners. If we take a snapshot of the Accounting Equation at a specific point in time, then we get a report called the Balance Sheet. It's a summary of a business's Assets, Liabilities and Equity. 🔴 Subscribe for more Accounting Tutorials → https://geni.us/subtothechannel 🔗OTHER RESOURCES ▪ My Website → https://accountingstuff.com/accounting-basics/accounting-equation 🔎FAQ ▪ My Favourite Accounting Book for Beginners → http://geni.us/5mKR7m 🔝 CLOUD ACCOUNTING SOFTWARE ▪ XERO (Free Trial / Discount) → https://xero5440.partnerlinks.io/08mfchsgfw8z ▪ QuickBooks Online USA (Free Trial / Discount) → https://geni.us/quickbooksonlineusa ▪ QuickBooks Online Canada (Free Trial / Discount) → https://geni.us/quickbooksonlinecanada 🚶FOLLOW ME ON ▪ Instagram → https://www.instagram.com/accountingstuff ▪ TikTok → https://www.tiktok.com/@accounting_stuff ▪ Facebook → https://www.facebook.com/accountingstuff #accounting #accountingequation #bookkeeping