I just started accounting and I don't know if I understand this type of problem
In 2002, the assets of company X increased by $50,000 and liabilities decreased by $42,000. The company's total equity at the end of 2002 equals $200,000. Calc the company's total equity at the start of 2002.
*I made up this problem up, similar to another
*I don't care as much about an answer but I want to know if i'm doing the right steps/understanding it.
*I think the key is to change find the change of equity, but i'm not sure
So would I just:
1. set assets = equity + liabilities as equity = assets - liabilities
2. Input Δassets(50,000) - Δliabilities(-42,000) = Δequity for the year
3. -Δequity + year end equity(200,000) = starting equity
any input would be much appreciated