Sample Balance Sheet

The following explains the essential elements of the previous blank balance sheet. Figures that would be used on this sheet are taken from a previous period Balance Sheet as well as the current periods Income Statement, also called a Profit and Loss Statement. Click on footnote numbers for explanations of the various elements.

 

ASSETS (1)

LIABILITIES (10)

Current Assets (2) Current Liabilities (11)
Cash $__________ Accounts Payable (12) $__________
Account Reveivables (3) $__________ Short Term Notes (13) $__________
Net Realizable A/R
$__________ Current Position of Long Term Notes (14) $__________
Inventory (4) $__________ Interest Payable (15) $__________
Temporary Investments (5) $__________ Taxes Payable (16) $__________
Prepaid Expenses (6) $__________ Accrued Payroll (17) $__________
TOTAL CURRENT ASSETS $__________ TOTAL CURRENT LIABILITIES: $__________
Long Term Investments (7) $__________ Long Term liabilities (18)
TOTAL INVESTMENTS $__________ Notes Payable $__________
Fixed Assets (8) Total Long Term Liabilities $__________
Land $__________ TOTAL LIABILITIES $__________
Building @ Cost $__________ Equity (19) $__________ 
LESS Accumulated depreciation
-$__________ Total Owner's Equity (proprietor) $__________
Net Book Value of Building
$__________ Total Partners Equity (If Any) $__________
Equipment @ cost $__________ Total Shareholders Equity (If Corporation) $__________
LESS Accumulated depreciation
-$__________ Capital Stock (If Corporation) $__________
Net Book Value of Equipment
$__________ Capital Paid in excess of Par $__________
Funiture and Fixtures @ Cost $__________ Retained Earnings $__________ 
LESS Accumulated depreciation
-$__________ TOTAL SHAREHOLDERS EQUITY $__________
Net Book Value of F&F
$__________ TOTAL LIABILITIES AND EQUITY (20) $__________
Auto/Trucks @ Cost $__________ Reconcilement of Equity (21)
LESS Accumulated depreciation
-$__________ Equity at beginning of Period $__________
Net Book Value of Auto/Trucks $__________ Plus Net Income or Less Net Loss $__________
Total Net Fixed Assets $__________ Plus Additional Capital Contribution $__________
Other Assets (9) Attach List $__________ Less Total Deductions $__________
TOTAL ASSETS $__________ Equity on Current Balance Sheet $__________

 
 
 

 


 
1. Assets Anything of value that is owned or legally due the business. Total Assets include all net realizable and net book values. Net realizable and net book values are amounts derived by subtracting any estimated allowances for doubtful accounts, depreciation, and reduction of future services such as amortization of a premium during the term of an insurance policy from the acquisition price of the assets. 
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2. Current Assets Cash and resources that can be converted into cash within 12 month of the date of the Balance sheet. Besides cash (money on hand and demand deposits in the bank), resources include the following:
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3. ACCOUNTS RECEIVABLES The amount due from customers in payments for good or services. 
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4.. Inventory Includes raw material on hand, work in process, and all finished goods either manufactured or purchased for resale.
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5. Temporary Investments Interest or dividend yielding holdings expected to be converted into cash within a year.  Also called MARKETABLE SECURITIES or SHORT-TERM INVESTMENTS, including stocks and bonds, certificates of deposits, and time deposit savings accounts. Should be listed on the balance sheet at either their cost or market value, whichever is less.
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6. Prepaid Expenses Goods, benefits, or services a business buys or rents in advance of use, such as office supplies, insurance protection and floor space.
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7. Long Term Investments Holdings the business intends to keep for at least a year and that usually yield interest or dividends. These include stocks, bonds and savings accounts earmarked for a special purpose.
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8. Fixed Assets The resources the business owns or acquires for the purpose of operations and does not intend to resale. Land is listed at original purchase price, with no allowance for appreciation or depreciation. Other fixed assets are listed at cost less depreciation  Fixed assets may be leased. Depending on the arrangement, both the value and the liability of the leased property may need to be listed on the Balance Sheet.
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9. Other Assets Resources not listed with any of the above assets. These include tangibles such as outdated equipment salable to the junk yard, and intangibles such as trademarks.
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10. Liabilities All monetary obligations of a business and all claims creditors have on its assets. Typically they include:
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11. Current Liabilities All debts and obligations payable within 12 months or within one cycle of operations.
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12. Accounts Payable Amounts owed to suppliers for good and services purchased in connection with business operations.
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13.
Short Term Notes
The balance of principal due to pay off short-term debts for borrowed funds.
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14. Current Portion of
Long Term Notes
Current amount due of total balance on notes whose terms exceed 12 month.
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15. Interest Payable Any accrued fees due for use of both short term and long term borrowed capital and credit extended to the business.
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16. Taxes Payable Amounts estimated by an accountant to have been incurred during the accounting period.
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17. Accrued Payroll Salaries and wages currently owed.
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18. Long Term Liabilities Notes, contract payments or mortgage payments due over a period exceeding 12 month or one cycle of operations. They are listed by outstanding balances, less the current portion due.
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19. Equity Equity is the claim of the owner(s) on the assets of the business. In a proprietorship or partnership, equity is the owners original investment plus any earnings after withdrawals.
In a corporation, the owners are the shareholders.  The corporation's equity is the sum of contributions plus earnings retained 
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20. Total Liability and Equity The sum of these two amounts must always match that for TOTAL ASSETS. In other words, they must BALANCE. This is why its called a BALANCE SHEET.
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21. Reconcilment of Equity Used for proprietorships and partnerships, this report reconciles the equity shown on the current balance sheet. it records equity at the beginning of the accounting period and details additions or subtractions from this amount made during the period. Typically, additions and subtractions are net income or loss and owner contributions and/or deductions
For corporations, the same type of report is called the STATEMENT OF RETAINED EARNINGS. It lists increases or decreases in this accumulated net income since the beginning of the current period
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