Balance the Accounting Equation

Does your company possess a balanced financial equation? Are you aware of the properly formulated equation? If you are not clear with these questions then we are here to solve your doubts. When talking about the balanced accounting equation, it should be clear in one statement:
Assets = Liability + Owner's Equity
(Total resources) (Claims on the resources)

Earning of income starts when the business begins. Income is calculated by subtracting revenues – expenses, gains – losses. At the end of the certain period the report looks like:
Assets = Liability + Owner'sEquity

+ Revenues
- Expenses
+ Gains
- Losses
+ Contributions
- Withdrawals
This accounting equation holds for the entire life of the business. When a transaction occurs, the total assets of the business might change but the considering the liability and the owner's equity the equation will always be balanced. The accounting equation acts as the base when the accountant prepares the balance sheet.
If you have any query regarding the respective topic please feel free to enquire. We will be happy to assist you.