Balance Sheet
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Balance Sheet
The balance sheet is a financial statement that displays a company’s assets, liabilities, and overall worth at a specific time. It’s called a balance sheet because the value of assets must always equal the sum of liabilities and owners’ equity. All financial statements lead to the balance sheet.
The formula for the balance sheet is:
Assets = Liabilities + Owners’ Equity
The example balance sheet provided below includes common categories, but each business is different and may have unique items based on its requirements.
Income statements have a standard format, and while some companies may have additional items, here are the basics.
Amounts shown are in thousands
Assets
-
Cash & cash equivalents $83
-
Accounts receivable 1,312
-
Inventry 1,270
-
Other current prepaid assets 85
-
Total Current Assets $2,750
-
Property, plant & equipment $2,230
-
Other long term assets 213
-
Total Assets $5,193
Liabilities
-
Accounts payable $671
-
Credit line 100
-
Deferred Revenue 351
-
Current portion of long term debt 52
-
Total Current Liabilities $1,174
-
Long-term debt 1,037
-
Other long-term liabilities 525
-
Total Liabilities $2,736
Owners' Equity
-
Common Stock $74
-
Additional paid in capital 1,110
-
Retained 1,273
-
Total Owners' Equity $2,457
-
Total Liabilities & Owners'Equity $ 5,193
Assets
-
Cash & cash equivalents $ 83
-
Accounts receivable 1,312
-
Inventry 1,270
-
Other current prepaid assets 85
-
Total Current Assets $ 2750
-
Property, plant & equipment $ 2,230
-
Other long term assets 213
-
Total Assets $ 5,193
Liabilities
-
Accounts payable $ 671
-
Credit line 100
-
Deferred Revenue 351
-
Current portion of long term debt 52
-
Total Current Liabilities $ 1,174
-
Long-term debt 1,037
-
Other long-term liabilities 525
-
Total Liabilities $ 2,736
Owners' Equity
-
Common Stock $ 74
-
Additional paid in capital 1,110
-
Retained 1,273
-
Total Owners' Equity $ 2,457
-
Total Liabilities & Owners'Equity $ 2,457
Assets
-
Cash & cash equivalents $83
-
Accounts receivable 1,312
-
Inventry 1,270
-
Other current prepaid assets 85
-
Total Current Assets $2,750
-
Property, plant & equipment $2,230
-
Other long term assets 213
-
Total Assets $5,193
Liabilities
-
Accounts payable $671
-
Credit line 100
-
Deferred Revenue 351
-
Current portion of long term debt 52
-
Total Current Liabilities $1,174
-
Long-term debt 1,037
-
Other long-term liabilities 525
-
Total Liabilities $2,736
Owners' Equity
-
Common Stock $74
-
Additional paid in capital 1,110
-
Retained 1,273
-
Total Owners' Equity $2,457
-
Total Liabilities & Owners'Equity $2,457
Assets
-
Cash & cash equivalents $83
-
Accounts receivable 1,312
-
Inventry 1,270
-
Other current prepaid assets 85
-
Total Current Assets $2,750
-
Property, plant & equipment $2,230
-
Other long term assets 213
-
Total Assets $5,193
Liabilities
-
Accounts payable $671
-
Credit line 100
-
Deferred Revenue 351
-
Current portion of long term debt 52
-
Total Current Liabilities $1,174
-
Long-term debt 1,037
-
Other long-term liabilities 525
-
Total Liabilities $2,736
Owners' Equity
-
Common Stock $74
-
Additional paid in capital 1,110
-
Retained 1,273
-
Total Owners' Equity $2,457
-
Total Liabilities & Owners'Equity $2,457
• Assets are things that the company owns, like cash, investments, machines, buildings, and land. Assets are divided into two categories: current assets, which can be turned into cash in less than a year, and long-term assets, which are physical assets that last for more than a year
• Liabilities are the money a company owes to other entities. Liabilities are split into two categories similar to assets. Current liabilities are the ones that need to be paid within a year. Long-term liabilities are the ones that are due over a longer period of time.
• Owners equity, shareholders’ equity, or stockholders’ equity is what is left over after we subtract our liabilities from our assets. Equity includes the capital provided by investors and the profits retained by the company over time, called retained earnings.
Our financial statements training classes go through the key terms on the balance sheet where you will get a clearer picture of how your company is doing.
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