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What is the diffrecnce between liabilities and owner's
equity?
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Answer Posted / syeda shadab
liabilities are the borrowed money from the outsiders such as the creditors and the owners equity is the asset of the company.owner's equity is the amount that is invested by the owner to the company.while liquidating the company(closing the company)the liabilities will be calculated first and the amount will be settled to the creditors and if the amount is remaining then after calculating the preference shares holders dividends then we will get the equity shares owners dividends.
therefor,we can say that the liabilities are the credits of the company and whereas the owner's equity is the asset to the company.
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