The Balance Sheet
Answer
1) Accounts receivable are current assets.
2) Yes, Accounts receivable and cash on hand total $35,000 while Taxes and accounts payable total only $27,500.
3) Land ownership represents 21% of the company’s fixed assets ($38,000)
Summary
As mentioned, a company’s origin, priorities and degree of success can be clearly gleaned by a review of It’s Balance Sheet. Not only can it reveal the past it can also highlight a prescription for suggested changes.
Balance Sheet Ending December 31st 2014.
|
Assets |
||
|
Current Assets
|
||
| Cash on Hand |
$10,000.00 |
ย |
| Accounts Receivable |
$25,000.00 |
ย |
| Inventory |
$15,000.00 |
|
|
Total Current Assets |
$50,000.00 |
|
|
Fixed Assets
|
||
| Garage and Equipment |
$40,000.00 |
|
| Less Depreciation |
($12,000.00) |
|
| Land Owned |
$8,000.00 |
ย |
| Other (Intangible Assets) |
$2,000.00 |
ย |
|
Total Fixed Assets |
$38,000.00 |
|
|
Total Assets |
$88,000.00 |
|
| ย | ย | |
|
Liabilities & Shareholder Equities |
||
|
Liabilities
|
||
| Accounts Payable |
$20,000.00 |
|
| Taxes Payable |
$7,500.00 |
ย |
| Long-Term Loan |
$15,000.00 |
ย |
| ย | ย | |
|
Total Liabilities |
$42,500.00 |
ย |
| ย | ย | |
|
Shareholder Equity
|
||
| Common Stock |
$45,000.00 |
|
| Retained Earnings |
0 |
|
|
Total Shareholder Equity |
$45,500.00 |
|
|
Total Liabilities $ shareholder Equity |
$88,000.00 |
