ECCB Micro-Business Simulation Workshop Presentations

The Balance Sheet: Characteristics of the Balance sheet THREE KEY FINANCIAL STATEMENTS

A balance sheet must always balance!

Total liabilities & equity

Total Assets

Current Liabilities Due within one year

Current Assets Used within one year

e.g. accounts payable

e.g. cash, inventory, accounts receivable

Non-current Liabilities Due in more than a year

Liabilities &Equity

Non-current Assets Lastmore than a year

e.g. long-term debt

Assets

Shareholders’ equity

e.g.property, plant and equipment, technology, patents, trademarks

e.g. common shares and retained earnings

All transactions are recorded in the balance sheet in two places. For every Debit there is a Credit!