5. Consider All Applications
When you put it all together, a balance sheet will probably look something like this:
A solid balance sheet can be used to secure financing or take a snapshot of a company’s current financial state, but it can also be used to evaluate the worth of your company over time.
Comparing your “Current Assets” minus “Current Liabilities” on a yearly basis will paint a picture of your company’s annual growth and expenses, which may have room for improvement. Calculating “Fixed Assets” minus “Fixed Liabilities” can provide a more long-term view of the company’s value over time, and its ability to pay back long-term debts or expenses built up over many years.
Remember, the expenses of different companies may vary greatly, don’t forget the assets and liabilities that are specific to your industry or area.