The Difference Between A Company's Assets And Its Liabilities is What?
The difference between a company's Assets and its Liabilities is Equity or Owner’s Equity according to Accounting Equation : Assets = Liabilities + Equity Assets - Liabilities = Equity This accounting equation is the basis of Double Entry System that all of the resources (Assets) must be equal to the Rights of Outsiders (External Liabilities) and Rights of Owners of the business (Internal Liabilities or Equity). Equity shows the right of owners against the assets of the business. Equity provides internal sources of finance for running and growing the business. If the investors invest into the business, then share capital increases which also increases equity on balance sheet.