Enter the total assets and total liabilities of the owner into the calculator. The calculator will evaluate the owner’s equity.
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Owner’s Equity Formula
The following formula is used to calculate an owner’s equity.
E = A – L
- Where E is the owner’s equity
- A is the total assets
- L is the total liabilities
Owner’s Equity Definition
Equity is a measure of any person’s assets minus their liabilities. Owner’s equity is simply this value with respect to the owner of a company.
Owner’s Equity Example
How to calculate an owner’s equity?
- First, determine the total assets.
Calculate the total value of assets of the owner.
- Next, determine the total liabilities.
Calculate the total cost of liabilities of the owner.
- Finally, calculate the owner’s equity.
Calculate the owner’s equity using the formula above.
Owner’s equity is the difference between the value of assets and the cost of liabilities of an owner.