Mubs CoursesUG

In accounting, equity represents the residual interest in the assets of an entity after deducting liabilities. It reflects the ownership value held by shareholders or owners. Equity includes common stock, preferred stock, retained earnings, and additional paid-in capital. It signifies the net worth of a company and is crucial for assessing financial health. Understanding equity is vital for stakeholders to evaluate company performance, financial stability, and potential for growth or investment.