What Goes On A Balance Sheet In Accounting

A Balance Sheet shows financial position of a business at a particular time in a specified date. It is very important financial statement for the Users of Financial Statements because it provides reliable information that is Material to them.

A balance sheet consists of Assets, Liabilities and Equity. It Has two Sides. One is Assets Side and other one is Liabilities And Equity Side. Assets are the Useful resources for the business owned by it. Assets are further categorized as Current Assets And Fixed Assets / Non Current Tangible Assets And Intangible Assets. Assets are Listed on Balance Sheet In The Order of Liquidity i.e. the most liquid asset comes first and then next most liquid asset and so on. Cash is the most liquid asset, so it comes first while Goodwill comes last as it has less liquidity as compare to other assets.

On Liabilities And Equity Side, firstly, Liabilities are shown then Equity. Liabilities are further listed under Current Liability and Long-Term Liabilities / Non Current Liabilities. Finally Equity section comes which consists of Retained Earnings, Share Capital, etc. calculated by preparing Equity T-Account or Ledger.

Example / Sample Of Balance Sheet Format

                                                                     ABC. Co.

                                          Balance Sheet / Statement of Financial Position

                                                           As On 31^st December, 2017

                                    Assets                                                            Liabilities & Equity

                                       Rs.                                                                              Rs.

  Current Assets           XXX                        Current Liabilities                         XXX

  Non Current Assets   XXX                        Non Current Liabilities                  XXX

                                                                                                                       _______

  Intangible Assets       XXX                        Total Liabilities                              XXX

                                  _______                                                                       ________

  Total Assets               XXX                                                                            ________

                                  _______

                                  _______                       Equity                                         XXX

                                                                                                                        _______

                                                                       Total Liabilities & Equity              XXX

                                                                                                                         _______

                                                                                                                          _______

The total of Assets side must be equal to the total of Liabilities & Equity Side, otherwise, the Balance Sheet is not prepared correctly. As According To the Accounting Equation.