Question

We can state the accounting equation for a corporation as

a. l= se
b. a − l − se = 0
c. a = l − se
d. −a l − se = 0

Answer 1

The correct accounting equation for a corporation is A = L + SE, which states that a company's total assets are equal to the sum of its liabilities and shareholder's equity.

Step-by-step explanation:

The accounting equation for a corporation states the relationship between its assets (A), liabilities (L), and shareholder's equity (SE). The correct representation of the accounting equation is A = L + SE. This means the total assets of the corporation are always equal to the total of its liabilities and shareholder's equity.

This fundamental principle of accounting ensures that the balance sheet remains balanced. Essentially, it reflects that all of the company's resources (assets) are provided by creditors or owners (liabilities or equity).