Accounting for IGCSE & O level - Final Statements (Section 5 - No. 47)
What is the relationship between assets, liabilities, and owner's equity?
Assets = Liabilities + Owner's Equity
Assets = Liabilities - Owner's Equity
Liabilities = Assets + Owner's Equity
Owner's Equity = Assets + Liabilities
Explanation
This is the basic accounting equation that states that a company's assets are equal to the sum of its liabilities and owner's equity.
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