Which equation represents the main components of the accounting equation?

The equation that accurately represents the main components of the accounting equation is Assets = Liabilities + Equity. This equation is fundamental to the double-entry accounting system, which ensures that every financial transaction is accurately reflected in the company's balance sheet.

In this equation, "assets" represent what a company owns, such as cash, property, inventory, and equipment. "Liabilities" encompass what a company owes, including loans, accounts payable, and other debts. "Equity" reflects the ownership interest in the assets after deducting liabilities; it represents the residual value available to shareholders.

This relationship demonstrates that all resources owned by a business (assets) are funded by creditors (liabilities) and owners (equity). This balance is crucial because it ensures that financial statements are accurate and complete, allowing stakeholders to assess the financial health of the organization.

In contrast to the other options, which do not correctly represent the comprehensive relationship between assets, liabilities, and equity, the correct accounting equation encompasses all the key components that form the foundation of financial reporting.