Even as the cash is spent for necessities of running the business, you need to keep track of how much you own on the loan used to obtain the cash. The loan itself is referred to as At 30 O Asset o Llability Stockholder's/Owner's Equity Woo Hoo! You are ready to start actually doing business! You have your first customer and they pay you. in cash. The cash itself what is that? Asset Liability O Stockholder's Owner's Equity Do you feel richer as the owner of the business? Well, you are! Your business got cash, and it didn't have to borrow (liability) to get that cash, so the value of your business just got bigger. The value of the business is referred to as... O Asset O Liability O Stockholder's/Owner's Equity