Accounting Dictionary - Letter E

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Equity
(also called net worth or net assets) is what an entity "owes" to owners. Equity can be called shareholders' equity in a corporation or owner's equity in a sole proprietorship. Equity is the difference between assets and liabilities: Equity = Assets - Liabilities. Equity accounts may include contributed capital (paid-in capital) and retained earnings. Equity accounts normally have credit balances.
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