Balance Sheet Template

A balance sheet, also referred to as a statement of financial position, is a summary of all the financial transactions and movements in a corporation’s financial accounts. The balance sheet provides an overview of a company’s assets, liabilities, ownership equity, and retained earnings. It presents an accurate picture of the state of a corporation’s balance sheet at a certain point of time.

The balance sheet usually provides an itemized list of all of the financial assets and liabilities. The balance sheet template used by most companies is a straight line drawing that reports the total assets of a company at a certain date. The total assets includes total assets of equity, retained earnings, and property, plant, and equipment. Laid-off debt and capital leases are not included in the assets.

Balance Sheet Template

Download a sample Balance Sheet for Microsoft Excel®
Download a sample Balance Sheet for Microsoft Excel®

The balance sheet should be prepared monthly, which means that the accountant should prepare them as soon as possible after the end of the reporting period. Preparing them this early will help in assessing and monitoring the progress and condition of the business. Most business owners find that using the excel balance sheet template is very useful in preparing their reports because it makes things much easier. If there are many changes, the business owner can easily update the report.

An important part of the balance sheet template is the column that reports current or fair value of the company’s common equity holders’ equity. This current value is a simple average of the fair market value of all of the assets and liabilities of the business. This value is an estimate because actual values may vary from period to period. The weighted average net worth of all of the company’s assets and liabilities is the current value.

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Download Balance Sheet Template

Another important part of the balance sheet template is the column that reports the components of the business. This includes current and long-term liabilities, accounts payable and accounts receivable, net cash in and out of accounts, short-term debt and inventory. The financial strength measurement is also included here. This refers to the ability of the business to pay its bills on time. This is calculated as the ratio of net worth to the total amount of current assets. It indicates the likelihood of the business’s assets to cover its liabilities.

The final column to the balance sheet template shows the results of the analysis. This usually indicates what should be done with the assets and liabilities if the company is going to get its cash flow and pay its bills on time. Most businesses choose to sell off some of their assets to raise funds for paying their bills. However, they may need to consider selling other assets to increase their liquidity or else their capitalization and creditworthiness may suffer.

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