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Assets Liabilities Owners Equity Expanded Accounting Equation is the advance version of basic accounting equation.
Example of expanded accounting equation. Assets Paid-up Capital Income Expenses Dividends Treasury shares. Following is the expanded accounting equation of corporations. About Press Copyright Contact us Creators Advertise Developers Terms Privacy Policy Safety How YouTube works Test new features Press Copyright Contact us Creators.
In summary the expanded accounting equation is relevant when identifying how stockholders equity in a firm changes from time to time at a basic level. Example of the Expanded Accounting Equation Taking an example of a corporation X to see how its business transactions affect its expanded equation. Expanded Accounting Equation The Expanded Accounting Equation of sole proprietorship and partnership is Accounting Equation Assets Liabilities Owners Equity Expenses Revenue Drawings Account.
However each item in this equation can be further expanded which will give us the expanded accounting equation. The expanded accounting equation for a corporation is. Lets take a look at a few example business transactions for a corporation to see how they affect its expanded equation.
However the relation between assets liabilities and equity still remains the same as in the basic accounting equation. The expanded accounting equation for a corporation provides more details for the stockholders equity amount shown in the basic accounting equation. It splits assets liabilities and equity into their components.
The expanded accounting equation will be the same as a more compact view of. The expanded accounting equation allows you to see separately 1 the impact on equity from net income. Assets Liabilities Paid-in Capital Revenues Expenses Dividends Treasury Stock.
How to use the Expanded Accounting Equation. At the beginning of the year Corporation X was formed and 1000 10 par value stocks were issued. Assets liabilities equity.
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