Question

What are the three groups of accounts shown on an unclassified balance sheet and define each group?

Answer 1

Three group of accounts shown on an unclassified balance sheet is assets, liabilities, and equities.

Asset - Asset represents the resources owned by a company which has economic value.

Liability - Liability repesents obligation of the business to a third party. It is otherwise knwon as claims of creditors on company's resource.

Equity - Equity represents the contribution of the owners and the amount of earnigns retained in the business. It is otherwise known as claims of stockholders on company's assets.