Equity is the subtraction of liabilities from assets. The result is regarded as equity.  Equity shows the interest (financially) of a business.

Owner's Equity is the percentage of the business that belongs solely to the owner.

Typically, equity represents the amount of money shareholders would receive if the assets of a company were liquidated and the debt of the company was repaid. A company's acquisition value is the value of its sales less any untransferred liabilities.

One of the most common measures analysts use to assess a company's financial health is equity, which appears on its balance sheet.

From the accounting equation, the following formula and calculation can be used to determine the equity of a firm:

Shareholders’ Equity = Total Assets − Total Liabilities