![]() ![]() Note that this means the bond issuance makes no impact on equity. Plug these numbers into the formula and you get: It also places a $50,000 credit to its bonds payable account, which is a liability account. As a result, your business posts a $50,000 debit to its cash account, which is an asset account. We’ll assume that your company issues a bond for $50,000, which leads to it receiving that amount in cash. Let’s look at an example using the above equations. Your goal with credits and debits is to keep your various accounts in balance. We can use a basic formula to figure out how much equity a business has: Basic Accounting Debits and Credits Examples ![]()
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