This capital is in the form of cash, goods or assets. For example – loan taken from bank, purchase of goods on credit.Ĥ) Capital :- Capital is the investment made by the owner of the business.
For example- Building, Vehicle, Machinery, Furniture.ģ) Liabilities :- Liabilities are given by others to the business. Profits depend on the purchase and sale of goods.Ģ) Assets :- Assets are valuable things, which are necessary for the business and are the assets of the business. For example – A grocery shop has soap, oil etc. So first we understand the meaning of these words –ġ) Goods:- Goods are bought and sold regularly and primarily in business. While learning accounting, we have to use some words regularly. With the above-mentioned advantages, we can easily understand that accounting is the soul of business.
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