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In financial accounting, a balance sheet (also known as statement of financial position or statement of financial condition) is a summary of the financial balances of an individual or organization, whether it be a sole proprietorship, a business partnership, a corporation, private limited company or other organization such as government or not-for-profit entity. assets, liabilities and ownership equity are listed as of a specific date, such as the end of its financial year. A balance sheet is often described as a "snapshot of a company's financial condition".[1] It is the summary of each and every financial statement of an organization.
Of the four basic financial statements, the balance sheet is the only statement which applies to a single point in time of a business's calendar year.[2]
A standard company balance sheet has two sides: assets on the left, and financing on the right–which itself has two parts; liabilities and ownership equity. The main categories of assets are usually listed first, and typically in order of liquidity.[3] Assets are followed by the liabilities. The difference between the assets and the liabilities is known as equity or the net assets or the net worth or capital of the company and according to the accounting equation, net worth must equal assets minus liabilities.[4]
Another way to look at the balance sheet equation is that total assets equals liabilities plus owner's equity. Looking at the equation in this way shows how assets were financed: either by borrowing money (liability) or by using the owner's money (owner's or shareholders' equity). Balance sheets are usually presented with assets in one section and liabilities and net worth in the other section with the two sections "balancing".
A business operating entirely in cash can measure its profits by withdrawing the entire bank balance at the end of the period, plus any cash in hand. However, many businesses are not paid immediately; they build up inventories of goods and acquire buildings and equipment. In other words: businesses have assets and so they cannot, even if they want to, immediately turn these into cash at the end of each period. Often, these businesses owe money to suppliers and to tax authorities, and the proprietors do not withdraw all their original capital and profits at the end of each period. In other words, businesses also have liabilities.
^Williams, Jan R.; Susan F. Haka; Mark S. Bettner; Joseph V. Carcello (2008). Financial & Managerial Accounting. McGraw-Hill Irwin. p. 40. ISBN 978-0-07-299650-0.
^"Four Types of Financial Statements". William & Mary. 2022-11-28. Retrieved 2024-02-15.
^Daniels, Mortimer (1980). Corporation Financial Statements. New York City: Arno Press. pp. 13–14. ISBN 0-405-13514-9.
accounting, a balancesheet (also known as statement of financial position or statement of financial condition) is a summary of the financial balances of an individual...
A decisional balancesheet or decision balancesheet is a tabular method for representing the pros and cons of different choices and for helping someone...
the trial balance and the credit value balance will be listed in the credit column. The trading profit and loss statement and balancesheet and other...
Food balancesheet shows a brief picture of the pattern of the food supply of a country. For each food item, it sketches the primary commodity availability...
A balancesheet recession is a type of economic recession that occurs when high levels of private sector debt cause individuals or companies to collectively...
interest and taxes (EBIT) – interest and tax expenses = profit/loss The balancesheet is the financial statement showing a firm's assets, liabilities and...
converted into cash (although cash itself is also considered an asset). The balancesheet of a firm records the monetary value of the assets owned by that firm...
farm business for a particular period of time, usually one year. The balancesheet measures the wealth or financial position of the business at a particular...
balancesheet recession concept in 2010, agreeing with Koo's situation assessment and view that sustained deficit spending when faced with a balance sheet...
trial balance stage, from which an accountant may prepare financial reports for the organisation, such as the income statement and balancesheet. The origin...
said to be insolvent. There are two forms: cash-flow insolvency and balance-sheet insolvency. Cash-flow insolvency is when a person or company has enough...
Consolidated BalanceSheet, Bank Of India Financial Statement & Accounts". www.moneycontrol.com. Retrieved 4 November 2021. "Bank of Maharashtra BalanceSheet, Bank...
developed and industry standards implemented. As mentioned above, off-balancesheet categories are also weighted as they contribute to both the assets and...
accounting, book value is the value of an asset according to its balancesheet account balance. For assets, the value is based on the original cost of the...
payment within an agreed time frame. Accounts receivable is shown in a balancesheet as an asset. It is one of a series of accounting transactions dealing...
of the customary appearance of accounts in the financial statements: balancesheet accounts followed by profit and loss accounts. The charts of accounts...
categories of initial and final balance, expressed in constant pesos as of the date of the most recent balancesheet, classified into three groups mentioned...
depreciated over multiple years. Capitalized expenditures show up on the balancesheet. Most ordinary business costs are either expensable or capitalizable...
accounting and tax purposes. The decrease in value of the asset affects the balancesheet of a business or entity, and the method of depreciating the asset, accounting-wise...
INC Published BalanceSheet As of 31 December 2023". BSP. bsp.gov.ph. Retrieved April 28, 2024. "UNION DIGITAL BANK Published BalanceSheet As of 31 December...
financial statements accompanied by a management discussion and analysis: A balancesheet or statement of financial position, reports on a company's assets, liabilities...
minus its operating liabilities. NOA is calculated by reformatting the balancesheet so that operating activities are separated from financing activities...
interest belongs to other investors and is reported on the consolidated balancesheet of the owning company to reflect the claim on assets belonging to other...
companies to create a so-called "common good balancesheet" than a financial balancesheet. The common good balancesheet is a value-based measurement tool and...