Work Smarter – Not Harder

Balance Sheet

The most important terms in time management

Back to Home page

What is a balance sheet?

A simple balance sheet is like a snapshot of the company’s overall financial health. It shows the assets, liabilities and equity of the company. This brings us to simple equation:

Balance sheet equation Assets = Equity + Liabilities

In Assets a company will show all the equipment, building and vehicles it has and also cash and accounts receivables.  The equity is the value of the shares issued by a company.  Liabilities show what company owes to other parties. This usually includes trade debt, short term and long term loans.

What does a balance sheet show?

A simple balance sheet should show three distinct parts: assets, liabilities and capital or “owner’s equity”, as it’s sometimes termed. Thisincludes details like the specific assets and their cost value. Based on the balance between assets on one side and owner’s equity with liabilities on the opposite side, you can get a rough sense of the valuation of a company.

Balance sheet report

Balance sheet report and pencil

How does a balance sheet help you?

A balance sheet is essentially a part of financial statement. It’s a simple but powerful tool to help gain an overview of a company’s financial health. You can use it to understand what is the companies profile, what is th difference between accounts receivable and account payble, what is the overall debit of the company.

zistemo puts business reporting in your hands by allowing you to generate and compare data over multiple time periods. Analyzing the business data is important in decisions that involve the growth of the company such as whether to buy more equipment, or if there’s enough value for investors

Accounting system B Balance sheet


Related words

Employee Time Tracking

What is employee time tracking? Employee time tracking is a function that is used to track the amount of time an employee spends on particular assigned tasks. Tasks usually fall under specific projects.

E

E-Invoicing

What is e-invoicing? Everything’s going digital: so why shouldn’t your bills? E-invoicing is a form of electronic billing. In any situation that requires an invoice be issued, an e invoice will suffice.

Commercial Invoice E e-invoicing

Commercial Invoice

What is a commercial invoice? If you run a small international business you’ve probably either received or had to issue a commercial invoice. Commercial invoices allow foreign trade and shipment to occur more seamlessly and easily.

C Commercial Invoice e-invoicing

Expense

What is an Expense? In the simplest terms, an expense is an outflow of money to another company or individual as payment for services rendered or an item acquired. In other terms, it is anything that leads to the reduced value of the owner.

E

zistemo: the productivity booster for your business

No credit card required. Cancel anytime.