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WAEC Financial Accounting 2008 Question 1

Question 1

Accounting Equation

Which of the following is the basic accounting equation?

  1. A.Assets = Capital + Liabilities
  2. B.Capital = Assets + Liabilities
  3. C.Liabilities = Assets + Capital
  4. D.Assets = Liabilities - Equity.
Show the answer and explanation

Answer: A (Assets = Capital + Liabilities)

Explanation

Assets = Capital + Liabilities.