Accounting Vocabulary
What are assets?
Things that the business owns.
What is the accounting equation to find assets?
Assets = Capital + Liabilities
What are Liabilities?
Liabilities are what the business owe.
What is the accounting equation to find capital?
Capital = Assets - Liabilities
What is Capital?
Resources invested in the business by the owner.
What is the accounting equation to find Liabilities?
Liabilities = Assets - Capital
2 examples of assets
cash, stock, bank, motor van
What is Capital, if: Bank loan= $1000 and Stock of goods= $2000
Capital = Asset - Liability
Capital = $2000 - $1000
Capital = $1000
An example of liabilities.
bank loan
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