Balance Sheet Assignment HelpA balance sheet is a financial statement summarizing the assets, liabilities and shareholders’ equity of a company either at calendar or fiscal year end. From the three main components of a balance sheet; assets, liabilities and shareholders’ equity informed investment decisions can be made. Investors need to know the ownership rights of a company, namely assets, what it owes or liabilities and the investment amount of shareholders. A balance sheet in accounting is among the vital financial statements that accountants and owners of businesses use. In other words it’s a statement of accounts summarizing the varied assets, liabilities and equities of a company on a given date. Owner’s or stockholder’s equity is not separate from liabilities but an integral part of liabilities. Granted, a balance sheet is a financial statement of a business at the end of the day. However a balance sheet could not possibly be more relevant than at the end of the accounting period also known as the balance sheet date.
Since assets, liabilities and owner’s equity are in balance, hence this financial statement is known as balance sheet and for good reason. Any company would have to pay for its assets either through a traditional lending institution; a bank for example or by acquiring funds from shareholders’ equity. Either way a debt or liability is created whether the funds are borrowed from a lending institution or from shareholder’s equity. The balance sheet is also known by another name and that is, the statement of financial position. The financial status of a company as on a particular date is presented on a balance sheet. The balance sheet is also described by some as an image of the financial condition at a specific point in time. A balance sheet is a reflection of the transactions that have been recorded until calendar year end or fiscal year end. Assets, Liabilities and Owner’s Equity are the three broad categories of a balance sheet. Included within each of these categories are several accounts that reflect the value of the categories. The accounts that would typically appear on the assets segment of the balance sheet are:
- inventory and
- Accounts payable or long-term debt.
- quite a few stakeholders both current and prospective
- management of companies
- a few customers
- government agencies and
- labour unions