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    Balance Sheet

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    Mba-it Bvdu
    A balance sheet is a financial statement that provides a snapshot of a company's assets, liabilities and shareholder equity at a specific point in time. It classifies assets and liabilities as either current (expected to convert to cash within one year) or non-current. On the liabilities side, it lists creditors and debt, and on the assets side it lists cash, inventory, equipment and other ownership interests. A properly organized balance sheet provides a clear picture of a company's financial position by grouping and ordering items in a standardized format with liabilities on the left and assets on the right.

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    Balance Sheet

    Uploaded by

    Mba-it Bvdu
    26 views2 pages
    A balance sheet is a financial statement that provides a snapshot of a company's assets, liabilities and shareholder equity at a specific point in time. It classifies assets and liabilities as either current (expected to convert to cash within one year) or non-current. On the liabilities side, it lists creditors and debt, and on the assets side it lists cash, inventory, equipment and other ownership interests. A properly organized balance sheet provides a clear picture of a company's financial position by grouping and ordering items in a standardized format with liabilities on the left and assets on the right.

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    A balance sheet is a financial statement that provides a snapshot of a company's assets, liabilities and shareholder equity at a specific point in time. It classifies assets and liabilities as either current (expected to convert to cash within one year) or non-current. On the liabilities side, it lists creditors and debt, and on the assets side it lists cash, inventory, equipment and other ownership interests. A properly organized balance sheet provides a clear picture of a company's financial position by grouping and ordering items in a standardized format with liabilities on the left and assets on the right.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    26 views2 pages

    Balance Sheet

    Uploaded by

    Mba-it Bvdu
    A balance sheet is a financial statement that provides a snapshot of a company's assets, liabilities and shareholder equity at a specific point in time. It classifies assets and liabilities as either current (expected to convert to cash within one year) or non-current. On the liabilities side, it lists creditors and debt, and on the assets side it lists cash, inventory, equipment and other ownership interests. A properly organized balance sheet provides a clear picture of a company's financial position by grouping and ordering items in a standardized format with liabilities on the left and assets on the right.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    balance sheet

    Definition and Explanation:


    A balance sheet is a statement drawn up at the end of each trading period stating therein
    all the assets and liabilities of a business arranged in the customary order to exhibit the true
    and correct state of affairs of the concern as on a given date.

    A balance sheet is prepared from a trial balance after the balances of nominal accounts are
    transferred to the trading account or to the profit and loss account. The remaining balances
    of personal or real accounts represent either assets or liabilities at the closing date. These
    assets ant liabilities are shown in the balance sheet in a classified form - the assets being
    shown on the right side and the liabilities on the left hand side.

    Grouping and Marshalling:


    In a balance sheet assets and liabilities should be properly grouped and classified under
    appropriate headings. The individual balance of each debtor's and creditor's account need
    not be shown. Debtors and creditors should be shown in total. The grouping together of
    dissimilar assets will make the balance sheet misleading.

    The term marshalling means the order in which assets and liabilities are stated on the
    balance sheet as the balance sheet exhibits the financial position of a concern even to a non
    technical observer. It is of great importance that the different assets and liabilities should be
    arranged in the balance sheet on certain principles.
    LIABILITIES ASSETS

    Current Assets
    Current Liabilities (Creditors: amounts falling Cash and Cash Equivalents
    due within one year) Accounts Receivable (Debtors)
    Accounts Payable Less : Allowances for Doubtful Accounts
    Current Income Tax Payable Inventories
    Current portion of Loans Payable Prepaid Expenses
    Short-term Provisions Investment Securities (Held for trading)
    Other Current Liabilities, e.g. Unearned Other Current Assets
    Revenue, Deposits Non-Current Assets (Fixed Assets)
    Property, Plant and Equipment (PPE)
    Non-Current Liabilities (Creditors: amounts Less : Accumulated Depreciation
    falling due after more than one year) Investment Securities (Available for
    Loans Payable sale/Held-to-maturity)
    Issued Debt Securities, e.g. Notes/Bonds Investments in Associates
    Payable Intangible Assets (Patent, Copyright,
    Deferred Tax Liabilities Trademark, etc.)
    Provisions, e.g. Pension Obligations Less : Accumulated Amortization
    Other Non-Current Liabilities, e.g. Lease Goodwill
    Obligations Other Non-Current Assets, e.g. Deferred
    SHAREHOLDERS' EQUITY Tax Assets, Lease Receivable
    Paid-in Capital
    Share Capital (Ordinary Shares, Preference
    Shares)
    Share Premium
    Less: Treasury Shares
    Retained Earnings
    Revaluation Reserve
    Accumulated Other Comprehensive Income

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