This document contains two examples demonstrating the accounting equation, which states that assets must equal capital or liabilities plus capital. The first example tracks cash, supplies, and equipment accounts over 5 transactions, showing a balance of assets equaling capital. The second example tracks 10 transactions across multiple asset and capital accounts, again resulting in balanced totals.

1. Accounting Equation – Practical application 1
Assets = Capital
Transaction cash + supplies + equipment + = Capital
a 5000 5000
b 250 250
c -200 -200
d -75 75
e -50 50
Total 4675 75 300 TRUE
Accounting Equation – Practical application 2
Assets = Capital
Transaction Cash Accounts Receivable Store Supplies Office Supplies Furnitures and Fixtures Equipment = Capital
(a) $20,000.0 $20,000.0
(b) -$1,200.0 $1,200.0
(c) -$170.0 $170.0
(d) -$1,500.0 $1,500.0
(e) -$750.0 $750.0
(f) $60.0 $60.0
(g) $300.0 -$300.0
(h) -$900.0 -$100.0 -$1,000.0
(i) $175.0 -$175.0
(j) -$65.0 $65.0
Total