[MacroUniversity]

Balance Sheet

ASSETS = LIABILITIES + SHAREHOLDER'S EQUITY

Asset Accounts

• Cash
• Marketable Securities: Government bonds or corporate stocks.
• Accounts Receivable: Amounts due from customers from the sale of goods or services on account. Firm collects cash from customer sometime after the sale.
• Notes Receivable: Amounts due from customers or others to whom a firm has made loans or extended credit. It differs from accounts receivable as the firm puts the claim into formal note.
• Interest Receivable
• Inventory
• Advances to Suppliers: Payments firm made in advance to suppliers for goods or services that it will receive in the future.
• Prepaid Rent
• Prepaid Insurance
• Investment in Securities
• Land
• Buildings
• Equipment
• Furniture and Fixtures
• Accumulated Depreciation: The total depreciation that has been expensed since a fixed asset was originally acquired. This total is the contra account to the related asset account.
• Organization Costs: Legal and incorporation fees and other costs incurred in organizing a business.
• Patents
• Goodwill: Goodwill = Identifiable Assets - Identifiable Liabilities

Liability Accounts

• Accounts Payable
• Notes Payable
• Interest Payable
• Income Taxes Payable
• Advances from Customers: General name used to indicate the obligation incurred when a firm receives payments in advance for goods or services it will deliver to customers in the future.
• Mortgage Payable
• Bonds Payable
• Deferred Income Taxes

Shareholder's Equity Accounts

• Common Stock
• Additional Paid-In Capital: Amount of cash or other assets received in the issuance of common or preferred stock in excess of par value.
• Preferred Stock
• Retained Earnings

Below is an example of a typical balance sheet:



Balance Sheet components and their relationships:



Click here to download the document without watermark