Sunday, January 3, 2021

Balance Sheet

 

Proper Balance Sheet under Accrual Basis or Cash Basis Accounting:






5 comments:

Peter Pan said...

Intangible assets - can fit a lot in there :)

Marian Ruccius said...

Nice, especially the esthetics of balance. I was crappy at accounting when I studied it, and I'm sure I still am. I read this statement and ask myself what this actually tells me about the state of a company. Why should I prefer the book value of a company as an indicator of its worth, to market value, or some other metric for analyzing a company? I know these are the questions of a neophyte, but when I think that land assets are given as the cost at acquisition, and that long-term debt is apparently easy to expand, I end up feeling more than a little uncertain (rather as I feel when confronted with an equation that seems perfect, but for which I am unable to perform a proof). How I envy the confidence of accountants when I think of this stuff (even though my 17 year old self would be appalled at the idea).

Matt Franko said...

You have to be good at following the rules Marian...

ie Can’t be taught properly via dialogic/dialectic methodology...

Marian Ruccius said...

Yaarh, in this single instance I concede

NeilW said...

Only when reporting to an owner and at Firm level. That's the point of this presentation format.

It doesn't alter how the transactions are stored and coded at a deeper level, or in different presentation format - like the National Accounts for example.

There is no one true presentation format. It depends what you are trying to show