What is the balance sheet?

Hello, I am a financial fitness expert, and I am glad to answer your question.

the balance sheet is an accounting statement that reflects all assets, liabilities and owners' equity of an enterprise on a certain date (such as the end of the month, the end of the quarter and the end of the year), and it is a static embodiment of the business activities of the enterprise. According to the balance formula of "assets = liabilities+owners' equity", according to certain classification standards and a certain order, the specific items of assets, liabilities and owners' equity on a certain date are properly arranged and compiled. It shows the economic resources owned or controlled by the equity on a specific date, the existing obligations undertaken and the owner's right to claim the net assets. It is a static statement that reveals the financial situation of an enterprise at a certain point in time.

the balance sheet uses the principle of accounting balance to divide the accounting transactions of assets, liabilities and shareholders' equity into two blocks, namely, assets and liabilities and shareholders' equity. After accounting procedures such as entry, transfer, ledger, trial calculation and adjustment, it is condensed into a statement based on the static enterprise situation on a specific date.

besides debugging, business direction and preventing abuses within the enterprise, its report function can also let all readers know the business status of the enterprise in the shortest time. The balance sheet is a very important financial statement in accounting, and its most important function is to show the operating conditions of the enterprise.

In the preface to the process, the balance sheet is the end of the bookkeeping procedure, and it is the final result and report after the entry, posting and trial adjustment. As far as nature is concerned, the balance sheet shows the comparative relationship between the assets, liabilities and shareholders' equity of an enterprise or a company, and accurately reflects the company's operating conditions.

as far as the basic composition of the statement is concerned, the balance sheet mainly includes the assets part of the left formula and the liabilities and shareholders' equity part of the right formula. However, if the front end of the operation is completely recorded in accordance with accounting principles and after the correct entry or transfer trial process, the total amount of the left and right side formulas of the balance sheet will inevitably be exactly the same. In the end, this formula is that the total amount of assets = the total amount of liabilities+the total amount of shareholders' equity.

I hope my answer can help you, and I wish you all the best _