expanding accounting equation — OpenTuition Forums

MMammuna10y ago

hi can someone please explain how do you get from capital=assets - liabilities to capital=opening net assets +profit- drawing thanks

kengarrettTutor10y ago#1

The first on is a snap-shot at any point in time. The second one is a 'journey': closing capital = opening net assets + profit - drawings. This explains how capital has changed over a period (note that opening net assets = opening capital)

MMammuna9y ago#2

thanks very much

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