The balance sheet

THE BALANCE SHEET

The balance sheet is a list of assets, liabilities and equity of a company in a given period.

The balance sheet actually serves to show the financial position of the company.

ASSETS

Fixed Assets

It is also called as non-current assets, these assets include:

* Factories

* Machinery and Equipment

* Buildings

* Computers

* Furniture

* Vehicles

These assets help the company to generate revenue in a given period, these assets are amortized.

Current Assets

These assets are constantly changing and include:

* Banks

* Cash

* Debtors

Also known as current assets as these are the ones that determine the ability to pay the company has.

Also assets are classified into tangible and intangible assets.

Tangible assets are physical assets such as buildings, machinery, equipment, etc..

Intangible assets are such trademarks, licenses, computer programs, etc..

LIABILITIES

There are two types of liabilities:

Current Liabilities

These represent short-term obligations having the company, these include debts to creditors and expenses have not been paid.

These are due within one year

Long-Term Liabilities

Also called non-current assets and relate to the obligations can be paid over a year, such as a bank loan that is amortized over several years.

EQUITY

The equity refers to what belongs to the shareholders or owners of a company.

capital is the initial contribution made by the employer to operate the company.

Design of the balance sheet

* The balance sheets are always a certain date

* It should consider the columns of the balance sheet

* It must clearly show each of the parts of the balance sheet at their respective title

* You should carefully review the trial balance and supporting notes

GLOSSARY

BALANCE SHEET – BALANCE GENERAL

EQUITY – PATRIMONIO

CURRENT ASSETS – ACTIVO CORRIENTE

CURRENT LIABILITIES – PASIVO CORRIENTE

GOOD WILL – BUEN NOMBRE

FIXED ASSETS – ACTIVO FIJO

DEBTORS – DEUDORES

DOUBTFUL – DEUDAS DE DUDOSO COBRO

DIVIDENDS – DIVIDENDOS

NET PROFITS – GANANCIAS NETAS

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