Which of the following equations is the fundamental accounting equation?

Question

Quizplus · Accepted Answer

The fundamental accounting equation is Assets = Liabilities + Owner's Equity. This equation represents the basic framework of double-entry accounting, where every transaction affects at least two accounts and keeps the equation in balance. Option A is incorrect because it subtracts liabilities from assets, which is not correct. Option C adds assets and liabilities, which is also not correct. Option D subtracts owner's equity from assets, which is not correct either. Option E adds assets and owner's equity, leaving out liabilities, which is not correct.

Which of the Following Equations Is the Fundamental Accounting Equation