yoyoyo welcome welcome welcome you've made it back to the classic series
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