A formal document prepared for interested persons (ex. stockholders and the general public) that reports the business’ assets, liabilities, and owner’s equity on a specific date. Like the Accounting Equation, it has 3 sections: Assets, Liabilities, and Owner’s Equity (Left) (Right) (Right)

1. Prepare the Heading 2. Prepare the Assets – Right Side 3. Prepare the Liabilities – Left Side 4. Prepare Owner’s Equity – Left Side 5. Add the Asset Amounts, Add the Liabilities, Add the Owner’s Equity 6. Make a Rule Line at each point there is addition or subtraction 7. Create the Labels for the Totals 8. Make a Double Rule at the end of the Sheet to show completion and correctness