Name : eka rahmawati

Jihan nur pratiwi salsabila

Balance sheet

The financial world cannot be separated from the accounting recording system in the
recording system there are various kinds of reports that are presented one of them
balance sheet. The balance sheet is one part of the financial statements of a business
entity / company in which there is information about assets, liabilities, and
shareholders' equity at the end of the company's accounting period. usually also
known as the statement of financial position (Balance Sheet or Statement of Financial
Position) or balance sheet is a report that must be made by a company. The report will
later be the basis for a business entity / company in making business decisions.
Companies that cannot produce balance sheet reports will be deemed a failure because
they are unable to give important information to stakeholders, government,
academics, and other parties who have a role in making policy. Referring to the above
balance sheet definition, there are three important elements in the financial balance
sheet, namely Assets, Liabilities, and Equity.

Assets or assets are assets owned by a business entity that are expected to give
future business benefits and assets are divided into two current assets Current assets
are assets whose useful life is for the short term. The process of liquidating current
assets is less than or a most of 1 year such as cash, Receivables, Equipment’s,
Inventory, and Costs are paid in advance while fixed assets are assets whose useful
life is to be used for a long period, more than a year. These assets are generally used
for business operations, such as land, buildings, machinery, and equipment.

After an asset has a liability, it is a payment obligation that must be made by a

business entity to another party, both in the long term and short-term. Some of the
liabilities included are Debt, Income paid in advance, and accrual (fees that will be
due). Liabilities or liabilities can be divided into two, first long-term debt is any debt
with a relatively long payment period such as debt bonds and mortgage debt. The
second, short-term debt is all debts that must be paid in a relatively long time, no later
than one year such as Notes Payable / Notes Payable Notes that must be paid to other
parties that have been before paid. In general the notes payable life is 30 days, 60
days, or 90 days. Trade payable this is debt to business partners
(suppliers) to company activities. For example, pay for goods that have
been before received and costs to be paid for all costs that have not been paid off in
one accounting period. For example, salary / wage debt and other cost debt. Then
there is capital, capital is money or goods that are used as a basis for doing a job. In
this case the capital in the balance sheet is the balance of the last capital of a company
in an accounting period. In other words, capital or equity is the difference or the
excess value of assets minus liabilities. With the Equity = Asset - Liability equation.

The balance sheet also has benefits, which are useful as a tool for analyzing
changes in the financial condition of a company periodically from year to year, useful
as a tool for analyzing the liquidity of a business entity so that the ability of a
company to do its obligations with liquid assets is known and Useful as a tool for
analyzing the ability of a company to pay off short-term debt before maturity. So the
conclusion is the balance sheet is one element in the financial statements that presents
assets, liabilities and capital in a company and has three benefits for the company.

Critical Question:

1. what is the impact if the company does not make a balance sheet?

2. what is the effect on the financial statements if a balance sheet is made

3. why balance sheet is very important to do

4. If the balance sheet is not made, will the company suffer losses?

5. When does a negative cash balance appear on the balance sheet?

6. How should a mortgage loan payable be reported on a classified balance

sheet?

7. How does an expense affect the balance sheet?

8. What is the difference between a balance sheet of a nonprofit organization

and a for-profit business?

9. Is it okay to have negative amounts in the equity section of the balance

sheet?

10. What are the limitations of the balance sheet?

Creative question

1. What are the steps to making a trial balance?

2. What is balance sheet

3. What are balance sheet accounts?

4. Where are accrual reflected on the balance sheet?

5. What does a balance sheet tell us?

6. What is a classified balance sheet?

7. What is the purpose of the balance sheet?

8. Explain how the balance sheet functions for the company?

9. What is the balance collection procedure?

10. What evidence is obtained by preparing a trial balance