Introducing the balance sheet

Companies create financial statements to provide information to potential…investors and creditors, helping current investors evaluate the health of the…performance of the company and summarize the company's resources.…One of those documents is the balance sheet.…And in addition to using the balance sheet as information for investors, you can…also use it to help you create your budgets.…In other words, you can do projections into the future based on the amounts that…you would like to see next year or anticipate seeing in each of these entries…based on the projected performance for the next year.…

There are several financial documents that you can use, but a balance sheet…summarizes the company's assets and liabilities.…Current Assets are cash or items that could be converted to cash within a year…and Current Liabilities are liabilities that must be paid within a year.…So in this case we have two current assets just grouped here under Operating…Assets and those are Cash and Accounts Receivable.…