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Dec 31, 2023
A balance sheet is a financial statement that provides a snapshot of a company's financial position at a specific point in time. It presents the company's assets, liabilities, and shareholders' equity, showing how these three components are balanced.
For example, let's consider a fictional company called XYZ Corporation. Here is an example of XYZ Corporation's balance sheet as of December 31, 2021:
XYZ Corporation
Balance Sheet
As of December 31, 2021
Assets:
Cash and cash equivalents: $100,000
Accounts receivable: $150,000
Inventory: $200,000
Property, plant, and equipment: $500,000
Total Assets: $950,000
Liabilities:
Accounts payable: $50,000
Short-term loans: $100,000
Long-term debt: $300,000
Total Liabilities: $450,000
Shareholders' Equity:
Common stock: $200,000
Retained earnings: $300,000
Total Shareholders' Equity: $500,000
Total Liabilities and Shareholders' Equity: $950,000
In this example, the balance sheet shows that XYZ Corporation has total assets of $950,000, which are financed by a combination of liabilities and shareholders' equity. The liabilities amount to $450,000, while the shareholders' equity is $500,000. The balance sheet demonstrates that the company's assets are equal to the sum of its liabilities and shareholders' equity, ensuring that the equation "Assets = Liabilities + Shareholders' Equity" is balanced.
For example, let's consider a fictional company called XYZ Corporation. Here is an example of XYZ Corporation's balance sheet as of December 31, 2021:
XYZ Corporation
Balance Sheet
As of December 31, 2021
Assets:
Cash and cash equivalents: $100,000
Accounts receivable: $150,000
Inventory: $200,000
Property, plant, and equipment: $500,000
Total Assets: $950,000
Liabilities:
Accounts payable: $50,000
Short-term loans: $100,000
Long-term debt: $300,000
Total Liabilities: $450,000
Shareholders' Equity:
Common stock: $200,000
Retained earnings: $300,000
Total Shareholders' Equity: $500,000
Total Liabilities and Shareholders' Equity: $950,000
In this example, the balance sheet shows that XYZ Corporation has total assets of $950,000, which are financed by a combination of liabilities and shareholders' equity. The liabilities amount to $450,000, while the shareholders' equity is $500,000. The balance sheet demonstrates that the company's assets are equal to the sum of its liabilities and shareholders' equity, ensuring that the equation "Assets = Liabilities + Shareholders' Equity" is balanced.
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