Liabilities are present obligations of an entity,whereas owners' equity is a residual interest or claim but not an obligation to transfer assets.

Name: Liabilities are present obligations of an entity,whereas owners' equity is a residual interest or claim but not an obligation to transfer assets.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Liabilities are indeed obligations of the entity to transfer assets or provide services, while owners' equity represents the residual interest in the assets of the entity after deducting the liabilities.

Liabilities Are Present Obligations of an Entity,whereas Owners' Equity Is