Preparing the Balance Sheet
Statement Header
- First line: name of the company
- Second line: name of the statement
- the word "partial" should appear if you not preparing the entire statement Example: Partial Balance Sheet
- Third line: date written in the format: As at [Date] Example: As at December 31, 2020
- Fourth line: the currency and unit Examples:
- (in Canadian dollars)
- (in million of US dollars)
- (in thousands of Euros)
Assets
The assets section is separated into two sections:
Current Assets
- List all current assets in this section
- Entered in order of liquidity (most to least liquid)
- Cash and cash equivalents
- Short-term investments
- Accounts receivables
- Other current assets
Non-Current Assets
- List all non-current assets in this section
- Depreciable assets are listed with the corresponding 'Accumulated depreciation' attached them
Liabilities
List liabilities in two sections
- Current liabilities: Starting with accounts payable
- Non-current liabilities
Shareholders' Equity
- List equity accounts in this section
- In this order:
- Contributed capital
- Retained Earnings
- Add total liabilities and total shareholders' equity together
Example: Balance Sheet
Cyrius Televisions Inc is a new company entering the electronics space. They specialize in the resale of very high-end televisions. The company's manager has presented you with a very unorganized list of financial information and has request for you to produce the company's balance sheet for as at December 31, 2020:
Additional information:
- Retained earnings balance is does not include the following information yet:
- Net income for 2020 totalled $120,000
- Dividends declared and paid in 2020 total $12,000