We will look the Format of Balance Sheet.
Meaning
Balance Sheet is a one of the three important financial statement. It reports a company assets, liabilities, and shareholder equity. Fundamental analyst use balance for his/her analysis.
Assets, liabilities and Equity is the major component of the balance sheet. Assets is the property of the company such as Building, land, stock, investment, etc. Similarly, Liabilities is the money owes by company which need to be paid in future. Moreover, Equity is the shareholder money. It is kept by company to run it.
Assets = Liabilities + Shareholder equity
It means Company buys its assets either from shareholder equity or by borrowing money from other (Liabilities).
Format of Balance Sheet
Following is the format of balance sheet.
| Liabilities | Amount | Assets | Amount |
|---|---|---|---|
| Share Capital | Fixed Assets | ||
| Equity Share Capital | XXX | Tangible Assets | |
| Preference Share Capital | XXX | Plat & Machinery/ equipment | XXX |
| Reserve and Surplus | Land & building | XXX | |
| Share Premium | XXX | Furniture and fixture | XXX |
| General Reserve | XXX | Freehold premises | XXX |
| Capital Reserve | XXX | Intangible assets | |
| Retained Earning | XXX | Goodwill, trademark | XXX |
| Profit and Loss A/C | XXX | Patent/ copyright | XXX |
| Long Term Debt | Investment | XXX | |
| Debenture/ bond | XXX | Current assets, loans,& Adv: | XXX |
| Loan / Mortgage loan | XXX | Sundry debtors/ book debt | XXX |
| Current Liabilities | Accounts / Bills receivable | XXX | |
| Sundry Creditors | XXX | Prepaid expenses | XXX |
| Accounts/ Bills Payable | XXX | Accrued income | XXX |
| Outstanding expense | XXX | Temporary Investment | XXX |
| Bank loan/ overdraft | XXX | cash in hand / bank | XXX |
| Income received in advance | XXX | Miscellaneous expenditure | |
| Provision for tax | XXX | Preliminary expense | XXX |
| Proposed/ provision for dividend | XXX | Underwriting commission | XXX |
| Discount/ loss on issue | XXX | ||
| XXX | XXX |
Note: These are the major headings which are frequently seen in balance sheet. Beside these other items are also shown in Balance sheet.
