I wrote:
> In fact, you can think of equity (capital) as a kind of liability: it's
> what the enterprise would owe to the owners if all the assets were sold and
> all the creditors paid.
Richard Wackerbarth writes:
> Yes, but you separate it because "Assets - Liabilities" is an interesting
> number. "Assets - (Liabilities & Equity)" is, shall we say, boring.
But useful in helping people understand double entry. If you think of
equity as the money the enterprise owes you it is easy to see why you want
to have the largest possible credit balance in that account.
--
John Hasler
[EMAIL PROTECTED]
Dancing Horse Hill
Elmwood, Wisconsin
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