In accounting terminology, the term Balance Sheet refers to a periodic statement of accounts for a corporation that lists assets and liabilities, as well as the owner’s equity. The Balance Sheet helps in determining the net worth of a business.
For example, a typical Balance Sheet will be separated into two parts. In the first part of a Balance Sheet, all of the working assets of the business are shown like cash and accounts receivable, as well as all of the non-working corporate assets like real estate. In the other part of the Balance Sheet will be listed all of the company’s debts and liabilities which represent the financing methods for the company and which include the shareholder’s equity. The Balance Sheet is an overall representation of the financial condition of the company at a particular time, and is generally one of the first documents examined by potential investors.