1. 1.
List ‘em up
Before we get to the actually structure of balance sheet, we shall see the components that make up the balance sheet.

2. What is your “worth?”
List top 10 most valuable ($$) things you own and their approximate value.
Do you have any debts? List them, too!

3. 2.
FINANCIAL REPORTS
Before we get to the actually structure of balance sheet, we shall see the components that make up the balance sheet.

4. 4 BASIC FINANCIAL REPORTS
Income statement
Balance sheet
Statement of cash flows
Statement of retained earnings

5. INCOME STATEMENT
Presents the revenues, expenses, and profits/losses generated during the reporting period
Considered the most important financial statement

6. INCOME STATEMENT
Revenue: the income generated by sale of goods/services (money earned)
Expenses: the cost in an attempt to generate revenue (money spent)
Profit/loss:
Profit: Revenue > Expense
Loss: Revenue < Expense

7. STATEMENT OF CASH FLOWS
Presents inflow and outflow of cash during the reporting period

8. STATEMENT OF RETAINED EARNINGS
Presents changes in equity during the reporting period

9. BALANCE SHEET
Presents the assets, liabilities, and equity as of the reporting date.

10. 3.
BALANCE SHEET
Before we get to the actually structure of balance sheet, we shall see the components that make up the balance sheet.

11. Balance Sheet
It is a financial report that lists assets, liabilities and owner’s equity. It shows the financial position of a business.

12. ASSET
Things that you own.

13. CHRIS TURNER’S FINANCIAL POSITION
Cash $55
Owed to Dad $200
Owed to Philip $80
Skip equipment $300
Bank balance $215.50
Library fines $12.50
Bicycle $185
Stereo $250
Total Assets: $
Cash $55
Owed to Dad $200
Owed to Philip $80
Skip equipment $300
Bank balance $215.50
Library fines $12.50
Bicycle $185
Stereo $250

14. LIABILITIES
Things that you owe.

15. CHRIS TURNER’S FINANCIAL POSITION
Cash $ 55
Skip equipment 300
Bank balance
Bicycle
Stereo
Total Assets $
Owed to Dad $200
Owed to Philip
Library fines
Total Liabilities $292.50

16. OWNER’S EQUITY The difference between assets and liabilities
Also called capital, equity, and net worth

17. FUNDAMENTAL ACCOUNTING EQUATION
A – L = OE
A = L + OE

18. CHRIS TURNER’S FINANCIAL POSITION
Cash $ 55
Skip equipment 300
Bank balance
Bicycle
Stereo
Total Assets $
Owed to Dad $200
Owed to Philip
Library fines
Total Liabilities $292.50

19. FUNDAMENTAL ACCOUNTING EQUATION AND CHRIS TURNER- L = OE
292.50
713.00