1. Describe the Purpose a Balance Sheet

The balance sheet is one of four types of financial statements that are analyzed to determine the well being of the firm. The balance sheet is also known as the Statement of Financial Position. The balance sheet provides the detailed information needed to determine the financial condition of the firm on a specific date, which is usually December 31. The balance sheet depicts what the firm owns (assets), owes (liabilities), and how much capital (shareholders’ equity) it has. “The name, balance sheet, is derived from the fact that these accounts must always be in balance. Assets

Several companies use the balance sheet to make sound business decisions. The balance sheet is like a quantitative summary of a company’s financial condition at a specific point in time, including the assets, liabilities,

A balance sheet gives an overall picture of a company's financial situation by showing the total assets of a business, including liabilities plus equity. Current assets can include cash, accounts receivable, inventory and prepayments for insurance. The balance sheet is used by investors to get an idea of what the shareholders have invested, including

* A balance sheet is snapshot of the financials for that organization (with assets on the left and liabilities on the right side) for that particular date that was requested

The balance sheet is considered a point in time statement because it elaborates on the current position of the organization. Based on the balance sheet, the organization is able to make an educated decision to know if it’s the best time to pursue additional business. The balance sheet is usually reviewed by a creditor when searching for new opportunities. Basically, the creditor determines the company’s position by subtracting the company 's liabilities from the assets. Liabilities are the debts and obligations a facility, regardless of the magnitude of the business. Once the liabilities have been subtracted from the assets, a stakeholder 's equity is determined.

Separately, the balance sheet reports a company’s financial position while the income statement reports a company’s fiscal year profits and losses. The balance sheet measures a company’s financial position by reporting its assets, liabilities, and owner’s (shareholder’s) equity. The income statement measures a company’s financial performance by reporting its revenues, expenses, and net income/loss. When combined, they serve two vital purposes: (1) expand the accounting equation and (2) enable analysis using ratios to determine industry position or potential material misstatements. The increase or decrease in owner’s (shareholder’s) equity on the balance sheet is a direct result of the net

The Balance Sheet is another type of financial statement used by a company to see a snapshot of the company's financial position at a particular point in time. It lists the value of the company's assets followed by its liabilities. A balance sheet can be summed up by a simple equation:

The balance sheet is one of the major and critical financial statements that show the financial position of the company. The balance sheets tell the user of the

As the value of money began to drop in 1694, Locke published Further Considerations Concerning Raising the Value of Money. Within this document, Locke writes about how the money that is within the economy must have a specific worth. Locke comments on the value of money, “Silver is the Measure of Commerce by its quantity, which is the Measure also of its intrinsick value. If one grain of Silver has an intrinsick value in it, two grains of Silver have double that intinsick value, and three grains treble, and so on proportionably. This we have daily Experience of, in common buying and selling.

Balance Sheet reports the financial position (economic resources and sources of financing) of an accounting entity at a point in time.

Explain the nature of balance sheets. A balance sheet is one of the major financial statements that a company prepares so that its investors and managers have visibility into the company’s financial position. The balance sheet details a company's resources and obligations. The major parts include assets, liabilities and shareholders' or owners’ equity. The balance sheet is run for

The statement of financial position and the balance sheet is statement that reviews the assets, liabilities, and equities that a business is holding at a particular moment in time. These elements: assets, liabilities, and equities; allows the reader of the financial statement to be able to identify what the company owns, owes, and has invested into the company.

A Balance Sheet is a snapshot of an organization’s assets, liabilities, and owners’ equity at any given time. It allows the stakeholder’s to see the company's financial condition, as well as, presenting what is owned and owed. Assets are the things that are owned, and are referred to as capital. Liabilities are the amounts owed to others. In order to get an accurate picture, one must look at the whole document, and make comparisons amongst different line items.

The balance sheet is also one of the annual accounts and main financial statements. It contains figures of business’ total assets, capital and liabilities at a particular time. The balance sheet is in two parts, one containing the details of

Letter of credit or L/C is the most common mode of payment opened for import of goods by a banker at the instance of his importer customer in favour of overseas seller. A L/C of credit may be commercial or non-commercial. When it relates to a mercantile transaction, buying and selling of goods, it is called a commercial letter of credit. And when it does not relate to any mercantile transaction, but only conveys an order of the opening