accounting for beginners number 30 treinta number 30 boy can you believe

that tres plus zero all right this is my

classic series this is your first video of mine hi how you doing if this is like

you're 30 or 40 or 50 video welcome back I'll put up a card to the

best accounting playlist on YouTube little bias but yeah now what are we

going to do in 30 we're going to do equity equity what is equity what is

equity CPH strength we're going to go over that what is equity let's start

with the definition here owners rights to assets after liabilities have been

paid damn I I jumped a little ahead of myself on this one didn't I DCA ler DC

aid ler write that out debit credit asset draw expense liability equity

revenue normal balances positive balances now we're doing we're doing

equity today what is that Gooding how equity is part

of the balance sheet what's the balance you don't know will you go down your DC

abler and you've done this enough so you know assets equal liabilities plus

equity you know the balance sheets right here these three things is the balance

sheet we're going to go with what is at what is equity today now we know that

the balance sheet assets equal liabilities plus equity

so assets equal liabilities plus equity all right we know that now that's

probably to get in green in your head two assets equal liabilities plus equity

it took me a long time to get that I'm not sure why it just did until I had I

started writing down this a DC a blur every morning on my practice papers and

then I just started noticing hey this is the balance sheet let's go let's go

the definition owners rights to assets after liabilities have been paid that

makes sense right this is what you have in your business let's say you have $10

cash that's your asset now that's kind of

equal that ten dollars has to equal you either are liable you either ellipticity

their oath at ten dollars to somebody or that ten dollars is all yours because

you don't because you don't have any liabilities or a combination of the two

I mean maybe you owe somebody five dollars of that and you own five

something like that a combination we're going to make it easy here for this

little example we're gonna we're gonna say that you don't owe anybody any money

at all you don't know anybody anything so your liabilities are zero your equity

would be ten dollars that's really what equity is it's rights to assets after

liabilities have been paid let's go through some common equities all right

there's really not too much on the equity the main thing is the retained

retained earnings but anyways stocks is a common equity

now that would be stocked I want to get to into the stocks

I really don't deal with them on the day to day basis for accounting and in my

opinion it's a little more advanced than the beginning this is kind of this would

what at what is equity is kind of like I don't know anything those are the owners

of the business the stocks that's a common equity if you don't have stocks

and you're like a publicly traded company one person you're the owner

Jonathan Dorn I'm the owner of the business but I have

aa that's you know I have stocks so they're the owners of the business I

still in stocks if you see stocked and a question or something like what is the

stock its equity a common equity a draw or a withdraw

you're like whoa whoa dog dog why are you doing that

he draws right there that's not equity a yeah I probably have to we will do

something on this again this is the reason why I do ade ler because I like

to keep the balance sheet right here draw is negative equity so if you see a

draw or with withdraw shareholder distribution a dividend it is it is an

equity it is just negative equity that's why I switch it over here because to do

to have a beginner to have a journal entry with negative but the negative

equity doesn't really make sense so common a common equity is a draw or

shareholders recent dividend that's how you get say you've got ten dollars you

got ten you got ten dollars cash and that's your this is your owner's equity

okay and you want to get it you want to get it out of the biz you want to get it

out of the business you would pay you would pay the owners and that's what you

would take a draw and that would you take a draw maybe say for ten dollars

you want to clear out the business so you take a draw for ten dollars you

would take out is $10 so you have a negative negative equity

I'll just do a balance you on that but no Nilla draws a common equity now we're

going to move with retain retained earnings is a very very common equity

I'll just know when you're doing journal entries and you know I have a bunch of

clients that I do the books for you don't really touch equity that much you

don't really touch maybe maybe you have a withdrawals distributions and stuff

during after your personal expenses but I don't really do

a journalist with the equity too much now retained earnings is the big one our

eats retained earnings the earnings that are retained in your business how does

the retained earnings happen let's go let's go with that how do the retained

earnings happen just know that we're doing equity what is it just know this

is this kind this is kind of big it's harder this is going to be another earth

this is going to be another video net income or loss becomes retained earnings

let's just think about that say you may say you made ten dollars one year that

is so you have so you've been the whole year you were going over to the new year

you made ten dollars and now you've switched over to the new year and you

still have that ten dollars that was your retained earnings so net

income when you made ten dollars and that one day you flipped over the new

year so that was an earnings that you made ten dollars an earnings and it was

retained into the business for another year as you can see I used to not put

out a lot of videos because as more and more people started watching thank you

very much for watching it's just a blessing I it's really changed my life

I've never heard really any nice things about me my whole life it's only been

negative negative you suck you suck you suck your piece of shit more people

started watching I try to be perfect with my videos and I don't say no that's

not good enough that's not good enough that's not good enough

meanwhile I don't have any videos I'm deciding imma let the people decide if

it has any value if it's good or not if you want to watch it and I'm just going

to show up and do the best I can and let everyone else decide what's with it

joining these man let's get these chippers up man I got to go to work

today I gotta make that money deuces