BUSINESS

WHAT IS A BALANCE SHEET?

A balance sheet is a financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time.

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WHATS THE BALANCE SHEET FORMULA?

Assets = Liabilities + Shareholders' Equity

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WHY ARE BALANCE SHEETS CALLED BALANCE SHEETS?

The balance sheets gets its name from the fact that the two sides of the equation above – assets on the one side and liabilities plus shareholders' equity on the other – must balance out

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WHAT ARE ASSETS?

Within the assets segment,accounts are listed from top to bottom in order of their liquidity, that is, the ease with which they can be converted into cash. They are divided into current assets, those which can be converted to cash in one year or less

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WHAT ARE LIABILITIES?

Liabilities are the money that a company owes to outside parties, from bills it has to pay to suppliers to interest on bonds it has issued to creditors to rent, utilities and salaries.

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WHAT ARE SHAREHOLDERS?

Shareholders' is the money attributable to a business' owners, meaning its shareholders. It is also known as "net assets," since it is equivalent to the total assets of a company minus its liabilities, that is, the debt it owes to non-shareholders

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WHAT IS EXPENDITURE?

an amount of money spent.

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WHAT IS REVENUE?

is the amount of money that a company actually receives during a specific period, including discounts and deductions for returned merchandise.

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WHAT IS A FIXED COSTS?

business costs, such as rent, that are constant whatever the amount of goods produced.

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WHAT IS A VARIABLE COSTS?

a cost that varies with the level of output.

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BUSINESS

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