Owners Equity Synonym

Q: Owner's equity is also known as _____________?

owner's equity capital net asset value


A:
There are a few synonyms for owner's equity.

As you will see in the comments at the bottom of the page, many people believe that equity and capital are synonyms. Actually, that's not true.

Check out this question and answer where I go over the two terms and the differences between them: Is Equity and Capital the Same?

In my opinion, the most common and accurate synonym for owner's equity is: net asset value.

Net asset value is the value of all assets after deducting all liabilities (meaning the value of debts to external parties).

"Net" actually means "after deducting something."

And the "something" we are deducting here is liabilities.

This definition actually comes from the basic accounting equation:

the basic accounting equation assets liabilities owners equity

You see, if we swapped around the equation to make owner's equity the subject, we get the following:

OWNER'S EQUITY = ASSETS - LIABILITIES

And that's exactly what net asset value means.

There are a few more synonyms for owner's equity, usually used more when talking about a company:
  • Net worth
  • Shareholder's equity
  • Stockholder's equity
Shareholders and stockholders are the same thing and refer to the individual owners of shares (small amounts) of a company.


Okay, that's it for synonyms for owner's equity.

Are there any more synonyms that I left out? If so, please add this in a comment further below.

Thanks for reading!

Best,
Michael Celender
Founder of Accounting Basics for Students


Related Questions & Tutorials:

Return to the full tutorial: What is Owners Equity?

Comments for Owners Equity Synonym

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Owner's Equity is...
by: DNCAIN

IF A=L+OE, then A-L=OE, and A-OE=L

A = assets = everything the business owns (what it makes and what it spends) (ALL THE LIABILITIES or debts + ALL THE EQUITY which is what's left after deducting debts from TOTAL ASSETS)

L = liabilities = debt (a/p or accounts payable = money that they actually have but will be paying out to it's suppliers and other creditors for product, services, loan's already received ON ACCOUNT) (subtracting the liabilities from assets LEAVES OWNER'S EQUITY which is the amount of the TOTAL OF IT'S ASSETS if all debts are paid)

OE = owner's equity = everything owned (CAPITAL = INVESTMENTS, EQUIPMENT, MERCHANDISE, INTEREST EARNED, REVENUE, PROFITS, etc. = remaining assets)

HOPE THIS HELPS

Great explanation, thank you!

Everything you wrote is good, I would just refer readers also to the chapter on Basic Accounting Concepts.

In that chapter you will find the pages where we clearly define Assets, Liabilities and Owner's Equity.

- Michael
Founder of Accounting-Basics-for-Students.com

Owners Equity
by: Muhammad Umair

Owners equity (rights of the owner in the business) is also called Capital.

Investment
by: Anonymous

Owner's equity is an investment used in business to gain profit eg: investment of land, machinery etc.

investment
by: Anonymous

what about the investment

o.e
by: Nodira

so owners equity includes capital withdrawals revenue and expenses

owners equity
by: Anonymous

Owners share of the assets of a business

CAPITAL
by: BENJAMIN NALE

START UP CAPITAL OF THE BUSINESS

Owner's Equity
by: Dan

At this stage it is the investments of the owner in the business. We can call it capital also.

capital
by: shalzzzzzzzz

capital

control accounts
by: roroo

apart from errors, explain why a credit balance may occur in a trade receivables control account?

owners equity
by: Anonymous

It means the owner's monetary in the business

Owner's Equity
by: Anonymous

Proprietor fund

capital
by: teddy tedrah tezrah

capital

Capital
by: Anonymous

The owners equity means the capital of the business

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