How to prepare a balance sheet?

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How to prepare a balance sheet?

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Categorize all assets by type (cash, receivables, equipment). Categorize all liabilities by type (accruals, accounts payable, loans payable).

Determine initial investment in business. Difference is “retained earnings”, which is cumulative profit from the start of the business.

The above assumes proper tracking of sales, purchases, disbursements, etc.

Balance sheet shows the financial positions of any company by comparing two sections: liabilities and assets.

Search google for “bench-marking-your-business-against-industry-averages” for a description of how you can find common asset and liability types of US corporations

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