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Liabilities and Assets in Balance Sheet

Why Liabilities are always on the left side and Assets on right side in the Balance Sheet?

E

Expert

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This is nothing although convention.

In United States they state Assets on the left side and Liabilities on the right side.

The accounting equation is as: Assets = Liabilities + Stockholders Equity

As you can notice the assets are on the left and Liabilities are on the right. On Balance sheet the Assets are reported initially and Liabilities and Stock holders Equity subsequently.

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