Intro to Business › Section N · Financial information and accounting › Topic N.3

The balance sheet

The balance sheet is a photograph of a business on one date: what it owns, what it owes, and what belongs to its owners. Lenders, suppliers and investors read it first when they want to know whether a firm is on solid ground.

In this topic

  • A snapshot, not a film
  • Order of liquidity
  • Current assets
  • Fixed assets and depreciation
  • Intangible assets
  • Liabilities
  • Owners' equity
  • Worked example: Kestrel's balance sheet
  • Worked example: book value and goodwill
  • Common mistakes to avoid
  • Key takeaways

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