Accounting Equation
The Accounting Equation is the fundamental principle of accounting, representing a company's financial position. The formula is:
Assets=Liabilities+EquityAssets=Liabilities+Equity
This equation indicates that a company's assets are financed by its liabilities and equity, ensuring the balance and accuracy of financial statements.
Definition:
The accounting equation is a fundamental principle in accounting that represents a company's financial position. The formula is:
Assets = Liabilities + Equity
This equation indicates that a company's assets are financed by liabilities and equity, ensuring the balance and accuracy of financial statements.
Origin:
The concept of the accounting equation dates back to the 15th century when Italian mathematician Luca Pacioli introduced the double-entry bookkeeping system in his work
