The Sage Course Companion on Financial Accounting is an accessible introduction to the subject that will help readers to master key concepts and enhance their thinking skills in line with course requirements. It provides support on how to revise for exams and prepare for and write assessed pieces.

The Balance Sheet

The balance sheet

Most accounting examinations will contain a question that includes a balance sheet (as well as a profit and loss account) and you should thoroughly understand this topic.

A balance sheet is a list of a business's assets, liabilities and equity at a given point in time. You may often see a balance sheet typically described as a photograph or ‘snap shot’ of a business at a specific day and time.


The balance sheet will show two types of assets:

Fixed Assets

Fixed assets (also referred to as ‘non-current assets’) include items such as factories, machinery, office buildings, computers, furniture, vehicles, etc. These types of assets are intended to be used to help the business generate revenue over a period of time. Normally these categories ...

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