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  2. Assets = Liabilities + Equity
    • According to 2 sources
    Balance sheets are usually created using this basic formula: Assets = Liabilities + Equity. The overall assets of a company (what it has or is owed) are "balanced" by the company's liabilities (what it owes) plus its equity.
    Embrace the Simple Formula As its name implies, it must balance, one side of the balance sheet must equal the other. The simple formula is Assets = Liabilities + Equity. Just like your personal net worth, your company’s balance sheet must factor in what you own and what you owe.
     
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