2.  Accounting data tells us the financial position of a person, business or other organization.  Financial position is the difference between “what you OWN and what you OWE”.  It is less commonly referred to as “net worth”.

3. and  Assets – things that are owned and have dollar value.  Liabilities – Another word for debts.  Owner’s Equity – what is left over after liabilities are subtracted from assets. It represents the owner’s personal stake in the business. This may be a positive amount or a negative amount.

4.  The accounting equation is usually rewritten as A = L + OE