(San Jose, CA, USA)
Where does theft fall into the equation on the balance sheet?
A business, starting with $102K in assets and $102K in liabilities, takes on a $50K loan, hires a $5K consultant, and negotiates a $10K license of its software. Then one of the directors leaves the country with $50K.
If we just add the cash in ($50K+$10K-$5K-$50K), we get $5K added to the assets, right? So $107K in assets.
But the $50K loan means there are $152K in liabilities.
How would we balance the sheet??
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