The document provides an overview of key concepts related to balance sheets: - A balance sheet is a financial statement that lists a business's assets, liabilities, and equity at a point in time. It provides a snapshot of what the business owns and owes. - The key components of a balance sheet are assets (what the business owns), liabilities (what the business owes), and equity (the owner's investment and retained earnings). Assets must equal the sum of liabilities and equity. - Current assets are items expected to be converted to cash within one year. Current liabilities are debts to be paid within one year. Net current assets is current assets minus current liabilities.

1. PRACTICE ECONOMICS…2 Ms Rosmin Bt Iqbal Hussain BOptom (UKM), CMBA (UNIMAS)

3. BALANCE SHEET

8. AD NBV minus Cost Value in Bracket ( ) indicate a negative value - need to subtract it Must balance *same value Total Fixed Assets Land & Building + Vehicles Fixed Asset ADD Long Term Investments ( > 1 year) X X (X) (X) X + X XXX + XX Current Assets LESS Current Liabilities ADD NETT Current Assets / Liabilities X (X) + XX LESS Long term Liabilities ( > 1year) XXX (XX) XXXX Financed By: Capital Less Drawing Nett Profit / Loss XXX (XX) XXX XXXX

10. Total Fixed Assets Land & Building + Vehicles TOTAL Asset ADD Long Term Investments ( > 1 year) X X (X) (X) X + X XXX + XX

16. BALANCE SHEET VALUE Total Fixed Assets Land & Building + Vehicles Fixed Asset ADD Long Term Investments ( > 1 year) Total Fixed Assets X + X XXX + XX XXX ADD NETT Current Assets / Liabilities (Current Asset - Current Liabilities) + XX LESS Long term Liabilities ( > 1year) BALANCE SHEET VALUE (net assets) XXX (XX) XXXX Financed By: Capital Less Drawing Nett Profit / Loss BALANCE SHEET VALUE (amt invested in co) XXX (XX) XXX XXXX

18. Trial / Balance As At (date) Debit Credit

20. Balance Sheet minus Must balance *same value Total Fixed Assets Land & Building + Vehicles Fixed Asset ADD Long Term Investments ( > 1 year) X + X XXX + XX Current Assets LESS Current Liabilities ADD NETT Current Assets / Liabilities X (X) + XX LESS Long term Liabilities ( > 1year) XXX (XX) XXXX Financed By: Capital Less Drawing Nett Profit / Loss XXX (XX) XXX XXXX

21. Trading Profit & Loss Acct Debit Credit Sales Less Sales Return / Return Inward Less Cost of Goods Sold X X X = Gross Profit x Add Other Revenue / Income X Less Expenses / Overheads x = Net Profit / Loss x

23. NOTES

32. Manufacturing Company Materials Inventory Finished Goods Inventory Revenues Cost of Goods Sold INCOME STATEMENT Period Costs Inventoriable Costs BALANCE SHEET Equals Operating Income when sales occur deduct Equals Gross Margin deduct Work in Process Inventory

33. Merchandising Company INCOME STATEMENT BALANCE SHEET when sales occur Inventoriable Costs Merchandise Purchases Inventory Revenues deduct Cost of Goods Sold Equals Gross Margin deduct Period Costs Equals Operating Income

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