The decision maker should note the following points on balance
sheets
1) a balance sheet is a statement of the financial position
of the business showing its
2) it lists the balances of all the accounts remaining after the
profit and loss account has been prepared, for example `Creditors`
and `Debtors` as in the example
3) the total of the debit balances of the accounts in
2. (usually the assets on the balance sheet) must equal the
total of the credit balances (usually the liabilities and capital
on the balance sheet).
Balance sheet as at 31.12.98
£ £
Capital - b/forward 1,855
Fixed Assets
Net profit 4,945 Car 2,500
Less drawings 4,800 Fixtures
and Fittings 3,000
Liabilities 145
Current Assets
Creditors 1,500 Stock 1,800
Bank loan 21,500 Debtors 15,200
Money in bank 2,000
Cash in hand 500
Total 25,000 Total 25,000
Some balance sheets may set out the details differently
