The document provides an accounting equation summary in 3 points: 1) It outlines the key components of the accounting equation: assets (A), liabilities (L), capital (C) and how total assets (TA) equal capital plus liabilities. 2) It shows how the accounting equation (AE) is a mathematical expression that shows assets and liabilities of a firm are equal. 3) It provides short forms for total expenses (TE), opening capital (OC), closing capital (CC) and other accounting terms and how they relate in the accounting equation.

1. DAKSH ACADEMY JAY MATA DI MOB- 9717841557
Accounting Equation
starting cash increase cash cash↓ capital↓
business withdrawings
capital increase goods stock↓ capital↓
prepaid cash↓ ppexp(A)↑ recd. in
cash↑ recd .adv(L)↑
dvance
paid on cash recd. on
expanses cash↓ capital↓ incomes cash↑ capital↑
time time
outstanding o/s liab.↑ capital↓ accrued acc.inc(A)↑ capital↑
loan recd. cash ↑ liab. ↑ asset decreases
liability depreciation
loan paid cash↓ liab.↓ capital decreases
on capital CAPITAL ↓ ↑ on CASH CASH↓ STOCK ↑
PURCHASE
interest
GOODS
on
withdrawings
CAPITAL ↑ ↓ on CREDIT CRDTR ↑STOCK↑
ON CASH↑ STOCK↓
PROFIT CAP↑
on CASH
CASH↑ STOCK↓ Purchase cash decreases
ON LOSS
CAP↓ asset for
SALES
ON DBTR↑ STCK↓ personal
PROFIT CAP↑ use(drw) capital decreases
on CREDIT
DBTR↑ STCK↓
ON LOSS CAP↓
C L A TA= C+P+L AE is mathematical expression
TE=OE +CE which shows that A AND L of a
A L C
OC=CC+D-AC-P firm are equal.
A C L
CC=OC+AC+P-D ☺☺☺☺☺☺☺☺☺
AMIT KUMAR < CS (P), M.COM. > Page 1