Statement of Financial Position (Balance Sheet)

This document shows what a business is actually worth at any particular time.

It is a snapshot of the business (taking a picture) here and now of what the business is worth.

It shows what the business owns (assets) and what it owes (liabilities)

Assets are items that the business owns.

Liabilities are what the business owes.

Stock, Cash, and Trade Receivables are known as liquid assets as they can be turned into cash easily.

Also known as Current Assets

Fixed assets are long-term, physical assets such as plant and equipment. Fixed assets have a useful life of more than one year.

Long-term liabilities is money that a business owes which is repaid greater than a year. A good example of this for a business can be a bank loan or a mortgage.