Balance Sheet
Quick Study Sheet
Financial Accounting
Balance Sheet
Quick Study Sheet
The Format of the Balance Sheet:
Operating cycle – the time it takes a company to spend cash to do business and get the cash back again. – Buy inventory, pay expenses, sell the inventory to a customer, collect receivables
The balance sheet is listed in the order of liquidity – how soon it will impact cash
Current means the cash is expected to be collected or paid in 1 year or less
Long term/Non-current means the cash is expected to be collected or paid > 1 year
The balance sheet is reported at historical cost; FM value on the date of the transaction