That assets, A for assets, is equal to

It should start to make a little bit of intuitive sense

So this is just another visual representation that

And then the equity is, essentially we would look at this formula.

Remember liabilities plus equities are equal to assets.

These are my assets.

liabilities.

Or the other way to view it is, assets minus liabilities is equal to equity, right?

liabilities plus equity is equal to assets.

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Each share in this case once again, if you believe that the assets are worth 1 million are going to be 1 million.

My liabilities would be 145,000.

These are my assets, and these are my liabilities.

like any corporation, and they have to, the liabilities, plus the equity has to match up to the assets.

That just comes out of the definition of what equity is.

And so liabilities plus equity is equal to assets.

I'll draw it a little bit bigger.

that assets are equal to liability plus equity.

What's my equity?

If you take an MBA, they'll write it down, and it looks

So I'm going to give you a little equation, actually, just to take a little bit of a tangent.

So once again they're valuing all of the assets at 225,000.

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And we have 23 billion in liabilities.

Because essentially, or you can view it this way, if you subtract liabilities from both sides, assets minus

So, remember, assets are equal to liabilites plus shareholder's equity, so if all of a sudden the market value of the equity, the market capitalization, for Ben's shoe company is 215,000... (That is the equity part right over here)

This is day 10 in this alternate universe.

Because assets are equal to liabilities plus equity.

Everything is going to be erased.

And this is another important thing to think about.

like an equation, but it's assets is equal to liabilities plus equity.

Well, its assets are let's see one plus 21, 25, 26 billion in assets and its liabilities are 23 billion.

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So notice, I now have negative equity, right?

So its assets.

So what are my assets?

So then he's done.

I'll do that in yellow.

It's derived from the original asset.

But I have an accounts receivable of 400, so my total assets now are 300 of assets, remember, accounts receivables aren't assets, because someone owes me something, someone owes me cash in the future.

And it's essentially, what is the market saying the equity is worth?

So what is left over for me?

It produced strange visual effects.

And so you can see very simply that assets I'll write this down, you're getting a little bit of a introduction to accounting right here but assets are going to always be equal to liabilities plus equity.

We said, and we learned it in the first video, and we