Relation between Assets and Liabilities ?

debit equal to credit

Assets-Increase

In a double-entry accounting system the total amount of all debit postings must be equal to the total amount credit postings or there is an error in the books. This what we refer to as the books being out of balance.

To summarize:
* assets put money in your pocket and are recorded as debit amounts,
* the corresponding income is recorded as credit amounts,
* liabilities take money out of your pocket and are recorded as credit amounts, and
* the corresponding expenses are recorded as debit amounts.
* Finally, equity or net worth is recorded as a credit amount.

Assets - Liabilities = Owners Equity

Assets = Liabilities + Owners Equity

For example,if there was $13,000 for assets and $2,000 for liabilities, the owners equity would be $11,000 as it's the sum of assets subtracted from liabilities.