As with liabilities, assets as well are spread into two major groups. Within assets on your balance sheet you can have two types of assets, both current and non-current. Continue reading
I think that there’s a really descriptive name given to an entity’s balance sheet for instance in the International Financial Reporting Standards. An entity’s balance sheet is also called as ‘statement of financial position’ and that’s exactly what a balance sheet in essence is. Continue reading
You would think that merging businesses is something big corporations do is not for you; however in practice it is very much so that small businesses merge just as often.
Whilst merging a company with another one is subject to all kinds or regulations, legal actions and so on, in terms of accounting there are a few things to remember as well. Continue reading
You know that you have to make a distinction of current and non-current on your balance sheet, but which method to choose. See also our post regarding the two methods being described in “Distinction of current and non-current on statement of financial position”.
Now when it comes to choosing the method, above all you must remember that the method you opt for, needs to present information in a most reliable and relevant manner as compared to the other option. It’s not just what you like but how it presents information to the users of the financial information. Continue reading
First lets agree that the “statement of financial position” you may have heard or read about is something we also like to call “balance sheet” from time to time. Regardless of how you name it though, it still includes your company’s assets, liabilities and equity balances. Name does not change the contents. Continue reading
An account on the balance sheet consists of following components – brought forward balance, debits and credits for the period and carried forward balance (a sum of the brought forward balance, the debits and the credits) that’s taken as a new beginning balance to the next period.
Brought forward balance or a beginning balance is something you start to build your current period’s balance onto. As such, it’s crucial that you bring forward correct balances on correct accounts. Continue reading