The correct expression of the accounting equation is: Assets = Liabilities + Equity.
The accounting equation is the foundation of double-entry accounting and is used to describe the relationship between a company's assets, liabilities, and equity.
Assets are the resources a company owns and uses to generate revenue, such as cash, equipment, and inventory.
Liabilities are the debts a company owes to others, such as loans or accounts payable.
Equity represents the ownership interest in the company and includes items like common stock and retained earnings.
The equation states that the total value of a company's assets must equal the sum of its liabilities and equity. This makes sense because a company's assets are either financed by debt (liabilities) or by the owners' investments (equity).
In other words, the accounting equation is a snapshot of a company's financial position at a specific moment in time, showing how its resources are being used to finance its operations.