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Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Balance Sheet

Definition:

A balance sheet contains a bunch of numbers and information that can help the accountant figure out the nitty gritty of a company.

For everyone else, a balance sheet just refers to the assets a company has. 

Example

Your daddy gives you $100 to start a chocolate pretzel stand. After 3 weeks, you've burned through $50 dollars on advertising, chocolate, pretzels, and a stand. At that moment on your 22nd day, given that the residual value of your chocolate, pretzels, and stand is $2, your balance sheet should show something like $52 of tangible worth. You have $50 in cash, presumably no liabilities, and $2 in net recoupment in scrap if and when you go out of business.