The Accounting Equation Table

The accounting equation table below acts as a quick reference to help show you the effects of typical start-up business transactions on the fundamental accounting equation. The table is based on the formula for the accounting equation as follows:

Assets = Liabilities + Owners Equity

The Accounting Equation Table Guide and Key

  1. Transaction: Each row represents a business transaction typical used when starting a business.
  2. Assets: The assets part of the basic accounting equation.
  3. Liabilities: The liabilities part of the basic accounting equation.
  4. Equity: The equity part of the accounting equation, which includes capital and reserves.
  5. + The item is increased due to the transaction.
  6. The item is decreased due to the transaction.
  7. + /- One item is increased and another is decreased due to the transaction.
The Accounting Equation Table
Transaction Assets Liabilities Equity
Injection of capital by owner + +
Property provided by owner + +
Office equipment purchased with cash + / –
Equipment purchased on account + +
Equipment sold + / –
Supplier account payment made
Revenue for cash sale received + +
Expense paid by cash
Cash withdrawn by the owner
Cash received from an account customer + / –
Loan is taken from a bank + +
Expenses incurred on account with a supplier +
Loan repayment is made with cash
Last modified November 6th, 2016 by Team

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