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CHAPTER 8 MASTERING YOUR MONEY
your company owns (i.e. Assets) relative to how much it owes
(i.e. Liabilities) at a particular point in time. The difference
between your company’s Assets & Liabilities is its shareholder’s
Equity (Equity). Shareholder’s Equity is the monetary value
that the investors have in the company.
Assets (OWN) – Liabilities (OWE)
= Shareholder’s Equity
Or Assets = Liabilities + Shareholder’s Equity
The Balance Sheet therefore tells you how financially strong
& stable your company is. This is what a simplified Balance
Sheet looks like. Once again, let’s look at the key components
of this statement and what you must pay attention to in building
a successful business.
FASHION PTE LTD BALANCE SHEET
ASSETS $
2008
Current Assets:
Cash & Fixed Deposits 60,000
Account receivables 83,000
Inventories 100,000
Total Current assets $243,000
Long Term Assets: 30,000
Office equipment 50,000
Furniture 30,000
Computers & Software $110,000
Total Long Term Assets
Total Assets $353,000
250 SECRETS OF BUILDING MULTI-MILLION DOLLAR BUSINESSES
