The Balance Sheet is different from the Profit and Loss account.
The Balance Sheet shows everything the business owns (it's assets) less everything it owes (it's liabilities). The balance sheet is a snapshot of the business at the reporting date.
Typical asset items:
- Bank balances
- Fixed assets (computer equipment, office equipment, vehicles)
- Stock
- Trade Debtors (money owed by customers)
Typical liability items:
- Trade creditors (money owed to suppliers)
- VAT and other taxes
- Business loans
If you add up all the values of the assets less the liabilities that figure is the "Net Asset Value" of the company.
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