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Assets are money that you have, and Liabilities are money that you owe. ``Liabilities'' is just a more inclusive name for Debts.

An Asset is typically increased by transferring money from an Income account, such as when you get paid. Here is a typical transaction:

@smallexample 2004/09/29 My Employer Assets:Checking $500.00 Income:Salary @end smallexample

Money, here, comes from an Income account belonging to ``My Employer'', and is transferred to your checking account. The money is now yours, which makes it an Asset.

Liabilities track money owed to others. This can happen when you borrow money to buy something, or if you owe someone money. Here is an example of increasing a MasterCard liability by spending money with it:

@smallexample 2004/09/30 Restaurant Expenses:Dining $25.00 Liabilities:MasterCard @end smallexample

The Dining account balance now shows $25 spent on Dining, and a corresponding $25 owed on the MasterCard---and therefore shown as $-25.00. The MasterCard liability shows up as negative because it offsets the value of your assets.

The combined total of your Assets and Liabilities is your net worth. So to see your current net worth, use this command:

@example ledger balance ^assets ^liabilities @end example

Relatedly, your Income accounts show up negative, because they transfer money @emph{from} an account in order to increase your assets. Your Expenses show up positive because that is where the money went to. The combined total of Income and Expenses is your cash flow. A positive cash flow means you are spending more than you make, since income is always a negative figure. To see your current cash flow, use this command:

@example ledger balance ^income ^expenses @end example

Another common question to ask of your expenses is: How much do I spend each month on X? Ledger provides a simple way of displaying monthly totals for any account. Here is an example that summarizes your monthly automobile expenses:

@example ledger -M register expenses:auto @end example

This assumes, of course, that you use account names like @samp{Expenses:Auto:Gas} and @samp{Expenses:Auto:Repair}.
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