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Forums › ACCA Forums › ACCA SBR Strategic Business Reporting Forums › Debt VS Equity
Hello,
Can someone help me out with these:
Equity def: entity receiving/delivering a fixed number of its own equity instrument in exchange for a fixed amount of cash
–> i would have thought the definition was meant for liabilities, as liabilities have fixed amount to be paid while equity don’t,
can someone clarify the logic behind this please?
Thanks a million!
Equity is an obligation to give or receive a fixed number of shares of an entity while liability is an obligation to pay cash.
Major difference “shares” and ‘cash’