What are assets & liabilities?

The assets are what allow the company to run. Liabilities and equity make up the right side of the balance sheet and cover the financial side of the company. This is a list of what the company owes. With liabilities, this is obvious – you owe loans to a bank, or repayment of bonds to holders of debt, etc.

What does equity mean on a balance sheet?

Put another way: when you take all of your assets and subtract all of your liabilities, you get equity. For a sole proprietorship or partnership, equity is usually called “owners equity” on the balance sheet. In a corporation, equity is shareholders’ equity. Category Description Asset

What is the difference between assets and liabilities on a balance sheet?

On the balance sheet, the assets side represents a company’s resources with positive economic utility, while the liabilities and shareholders equity side reflects the funding sources. What are the Components of the Accounting Equation? How Does the Double Entry Accounting System Work?