Expanded Accounting Equation is extension of Basic Equation (Assets = Liability + Owner’s Equity). In case of non-corporate form of business expanded equation shows as (Assets = Liabilities + Owner’s Equity) – Expenses + Revenue – Drawings Account. In case of corporate form of business organization expanded accounting equation shows as (Assets = Liabilities + Stockholders’ Equity) – Expenses + Revenues – Treasury Stock – Dividends.

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