Multiple choice

The accounting equation is most often stated as

  1. Assets=Liabilities+Owner's Equity

  2. Assets+Liabilities=Owner's Equity

  3. Assets=Liabilities-Owner's Equity

  4. Assets+Owner's Equity=Liabilities

Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

The fundamental accounting equation is Assets = Liabilities + Owner's Equity. This equation must always remain in balance.