
See Equipment for the full rules in this example. Using the above image, note:
Green boxes: are equipped items. One two-handed weapon (Battle Axe) is taking two slots (the E2), thieves' tools (E1), and leather armor (E1). Note how they all have a weight of 0.
Blue box: Coins and gem in a single slot. There are 72 coins and 1 gem in the purse so there is room for 27 more coins/gems before another slot is needed. Notice that the Coins section below is kept blank.
Purple box: at bottom right is the Encumbrance which is counting the number of Packed items (7). This totaling up all of weight (in slots) the equipment, weapons, and armor that is packed.
Red box: at top, the Exploration rate has been changed to 90 as this character has 7 packed items and 4 equipped items.
Torches: notice how torches have the quantity in the name field (Torches x7) and NOT the Qty. Torches are bundle items so every set of 3 takes one slot, so their weight is 3 slots (with space for 2 more torches in that 3rd slot).
Silver necklace being a jewelry item (tiny) has no weight and does not need to take an equipped slot.