The Accounting Equation Explained With Examples Youtube In this video we’re going to take a look at how to apply the accounting equation to your personal life and your business. timestamps:00:0. In this basic accounting lesson, we explain what the accounting equation is, why the accounting equation is done, and we go through examples of how the accou.
The Accounting Equation Explained With Solved Problem Youtube Accounting equation explained very easy, using examples and pictures to help you understand the equation. by understanding the accounting equation, you will. In fact, the entire double entry accounting concept is based on the basic accounting equation. this simple equation illustrates two facts about a company: what it owns and what it owes. the accounting equation equates a company’s assets to its liabilities and equity. this shows all company assets are acquired by either debt or equity financing. The basic accounting equation is: assets = liabilities capital. sample business transactions. here are more examples to further illustrate how the accounting equation works. below are additional transactions following example 1, 2 and 3 in the previous lesson: rendered services and received the full amount in cash, $500. Liabilities are obligations to creditors such as invoices, loans, taxes. the owner’s equity represents assets belonging to the owner or shareholders. the accounting equation can be rearranged into three different ways: assets = liabilities owner’s capital owner’s drawings revenues expenses. owner’s equity = assets liabilities.
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