Balance Sheet
In the beginning,
is the Balance Sheet,
XE "balance sheet" XE
"statement of financial position"
which the Financial Accounting Standards
Board (FASB) has renamed the Statement of
Financial Position. All of the assets
controlled by the company are added up, then
all of the liabilities are added, and the sum
subtracted from the assets. The “owners”
own whatever part of the assets cannot be
claimed by others; their share is called
equity. The accounting having been done
correctly, the sum of all the assets minus
the sum of all the liabilities equals equity.
The balance sheet is a
flash picture. It shows the company’s
financial position at one point in
time. QuickBooks basically generates a
balance sheet by summarizing all of the
transactions in each balance sheet account
since time began (January 1, 1928,) up
through the date of the report.
NOTE
The Balance Sheet is the only report which will summarize transactions which are transfers, with balance sheet accounts on each end. Details of transfers can be displayed in
Transaction Reports (below.)
The view shown is the
printed report. The display has options
similar to the Profit and Loss Report,
below. The date prepared is optional,
but if shown, is the computer system date.
icon note
The traditional balance
sheet requires closing of the books.
Special transactions are recorded, moving the
balance of each income and expense report
into retained earnings. QuickBooks has
a small variation on this. In effect,
the books are closed instantly by running a
balance sheet. But the traditional
closing transactions are not created.
When the report is generated, all income and
expense transactions are summarized in two
earnings accounts, which appear as the last
two accounts on the balance sheet.
Retained Earnings
contains income and expense results for all recorded time prior to the current fiscal year.
Net Income shows the bottom line
of the Profit and Loss Report for the current
fiscal year. Both of these accounts
have dedicated functions, which cannot be
changed.
[do not use screen capture report illustration. use paper artwork.]
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