Basic concept question on "Basic Accounting Equation"
Duncan Thomson
clymbon at gmail.com
Thu Feb 25 11:55:30 EST 2010
The "GnuCash Tutorial and Concepts Guide" provides the following as the
"Accounting Equation"
* Assets - Liabilities = Equity + (Income - Expenses)*
But that seems wrong. It is equivalent to
* Equity = Assets - Liabilities - Income + Expenses*
That would imply that as my income goes up my equity goes down, and as my
expenses go up my equity also goes up. I wish that were true!
Am I missing something?
- Clueless accounting newbie
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