Practicing Success
What is the fundamental accounting equation? |
Assets = Liabilities - Capital Assets + Liabilities = Capital Assets + Capital = Liabilities Assets = Liabilities + Capital |
Assets = Liabilities + Capital |
The correct answer is option 4- Assets = Liabilities + Capital. Dual aspect is the foundation or basic principle of accounting. It provides the very basis for recording business transactions into the book of accounts. This concept states that every transaction has a dual or two-fold effect and should therefore be recorded at two places. In other words, at least two accounts will be involved in recording a transaction. The duality principle is commonly expressed in terms of fundamental Accounting Equation, which is as follows : |