What are Assets & Liabilities in Accounting? Definition & Example

In accounting, assets are anything that is owned by a business and has value. This can include cash, inventory, property, equipment, and investments. Liabilities are anything that a business owes to others. This can include money that is owed to suppliers, customers, employees, or the government. Both assets and liabilities are important in accounting because they can have a significant impact on a company's financial statement.

Assets are anything of value that a company owns, while liabilities are anything owned by the company. In accounting, these items are recorded on the balance sheet, which is a statement of a company's financial position at a particular point in time. The purpose of the balance sheet is to show how much the company is worth, and this is determined by subtracting the total liabilities from the total assets.

Some examples of assets include cash, inventory, buildings, and equipment. Liabilities include things like accounts payable, loans, and credit cards. Equity is also listed on the balance sheet and is equal to the difference between assets and liabilities.

In accounting, assets are anything that has value and can be converted into cash. This could include cash on hand, investments, accounts receivable, inventory, land, buildings, equipment, or anything else that has value. On the other hand, liabilities are anything that a company owes. This could include accounts payable, loans, credit card debt, or any other type of debt.

In accounting, assets are anything that has value and can be converted into cash. Liabilities are anything that a company owes. For example, a company may have inventory (an asset), but it may also have accounts payable (a liability). The balance sheet is a statement that shows a company's assets, liabilities, and equity.

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