Accounting Equation: Why not
Assets = Equity - Liabilities?

by Anonymous

Q: Why don't they say assets = equity - liabilities instead of + liabilities?

Your answer lies in the definitions of each of the three elements (parts) of this equation. See the respective lessons on the accounting equation and on each of these elements of accounting in the section Basic Accounting Concepts.

Comments for Accounting Equation: Why not
Assets = Equity - Liabilities?

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by: Anonymous

Assets is made up of equity and liabilities.

by: Anonymous

I think if you borrow money from the bank, it's on your hand so it becomes your asset. However, you still owe it so it is on the other side of the equation as an amount you owe.

Liabilities are already negative
by: Anonymous

Liabilities are already negative. If in an algebra formula you subtracted a negative it has the effect of adding it.

Assets = Equity plus Liability
by: Anonymous

Because Assets is made by Equity plus Liability

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