UK Basic Balance Sheet question

Apr 6, 2021
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United Kingdom
Oh hi there

Ok have been looking at the "balance sheet" videos and this is my understanding so far:

The accounting equation is assets = equity + liability

So lets say I have in the bank £5000 cash (i.e. from payment from work the ltd does) (current assets)
+ £1000 in IT equipment after the depreciation (fixed or non-current assets) = £6000

I have a salary liability of say £2000 and £3000 equity in retained earnings = £5000

Ignoring for the moment the £1 stake in the share capital, how do I balance this out?

How do I get the £1000 into the right hand side of the equation - i.e into the equity & liabilities? so as to balance it out?


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