{"id":28558,"date":"2023-08-21T19:18:18","date_gmt":"2023-08-21T19:18:18","guid":{"rendered":"https:\/\/swoopfunding.com\/ca\/?post_type=business-glossary&p=28558"},"modified":"2025-04-24T13:54:26","modified_gmt":"2025-04-24T13:54:26","slug":"equity","status":"publish","type":"business-glossary","link":"https:\/\/swoopfunding.com\/ca\/business-glossary\/equity\/","title":{"rendered":"Equity"},"content":{"rendered":"
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Definition<\/h3>\n

Equity<\/a>, in financial terms, refers to the ownership interest or residual value that remains in a company after deducting its liabilities from its assets.<\/p>\n

What is equity?<\/h3>\n

It represents the portion of a company’s assets that belongs to its owners or shareholders. Essentially, equity is the value that shareholders hold in a company, and it can be thought of as the difference between a company’s total assets and its total liabilities. Equity provides a measure of the company’s net worth and is a key component of the company’s balance sheet<\/a>. It can also be referred to as “shareholders’ equity” or “stockholders’ equity.”<\/p>\n

Example of equity<\/h3>\n

Let’s consider a fictional company, XYZ Inc., with the following financial information:<\/p>\n

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  • Total assets: $1,000,000<\/li>\n
  • Total liabilities: $400,000<\/li>\n<\/ul>\n

    Equity <\/span><\/span>= <\/span><\/span>Total a<\/span><\/span><\/span><\/span><\/span><\/span>ssets\u00a0<\/span><\/span>\u2212 <\/span><\/span>Total liabilities<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n

    Equity <\/span><\/span>= $<\/span><\/span>1<\/span>,<\/span>000<\/span>,<\/span>000 <\/span>\u2212 $<\/span><\/span>400<\/span>,<\/span>000 <\/span>= $<\/span><\/span>600<\/span>,<\/span>000<\/span><\/span><\/span><\/span><\/span><\/p>\n

    In this case, the equity of XYZ Inc. is $600,000. This amount represents the ownership interest that shareholders have in the company after accounting for all its liabilities.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"author":1,"template":"","class_list":["post-28558","business-glossary","type-business-glossary","status-publish","hentry"],"acf":[],"featured_image_urls_v2":{"full":"","thumbnail":"","medium":"","medium_large":"","large":"","1536x1536":"","2048x2048":"","image_blog":"","image_blog_full":"","image_podcast":"","image_banking":"","image_blog_internal":"","image_blog_medium":"","image_single_banking":""},"post_excerpt_stackable_v2":"

    Definition Equity, in financial terms, refers to the ownership interest or residual value that remains in a company after deducting its liabilities from its assets. What is equity? It represents the portion of a company’s assets that belongs to its owners or shareholders. Essentially, equity is the value that shareholders hold in a company, and it can be thought of as the difference between a company’s total assets and its total liabilities. Equity provides a measure of the company’s net worth and is a key component of the company’s balance sheet. It can also be referred to as “shareholders’ equity”…<\/p>\n","category_list_v2":"","author_info_v2":{"name":"root","url":"https:\/\/swoopfunding.com\/ca\/author\/root\/"},"comments_num_v2":"0 comments","_links":{"self":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary\/28558","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary"}],"about":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/types\/business-glossary"}],"author":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/users\/1"}],"version-history":[{"count":1,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary\/28558\/revisions"}],"predecessor-version":[{"id":39075,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/business-glossary\/28558\/revisions\/39075"}],"wp:attachment":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/media?parent=28558"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}