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The accounting equation signifies that the assets of a business are always equal to the total of its liabilities and capital. The accounting equation decodes the fundamental relationship among the components of the balance sheet, it is also called the Balance Sheet Equation. As the name suggests, the balance sheet is a statement of assets, liabilities, and capital.
The equation goes as follows:
Assets = Liabilities + Capital
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What is an accounting equation?
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Which of the following is an accounting equation?
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What isthe basic accounting equation?
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Accounting equation is simply an expression of the relationship among in a business.
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Show an Accounting Equation on the basis of the following transactions: ₹ (i) Sunil started business with cash 1,50,000 (ii) Opened a Bank Account by depositing ₹ 25,000 out of cash (iii) He sold his personal car for ₹ 50,000 and deposited the amount in the firm's Bank Account (iv) He purchased a building and furniture for 1,00,000 (v) He purchased goods from Ram on credit 50,000 (vi) He paid cartage 500 (vii) He sold to Shyam on credit goods costing ₹ 6,000 for 9,000 (viii) Received rent from tenants 1,000 (ix) Received security deposit from tenants 1,500 (x) Purchased stationery for cash 100 (xi) Invested in shares (personal) 50,000 (xii) Received interest in cash 200 (xiii) Introduced fresh capital 25,000 (xiv) Goods destroyed by fire 500
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