What Is a Balance Sheet?
A balance sheet is a financial statement that shows what a company owns (assets), what it owes (liabilities), and the owners’ stake (equity) at a specific point in time. It always balances according to the accounting equation: assets = liabilities + equity.
Main Sections
Current assets and liabilities are expected to be converted to cash or paid within a year; long-term items extend beyond a year.
Personal Version
A household net worth statement follows the same logic: assets minus liabilities.
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🔗 Related Terms
More Business & Sales Terms
- Accounts Payable
- Accounts Receivable
- Average Order Value (AOV)
- Break-Even Point
- Burn Rate
- Cash Runway
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Last updated: September 29, 2026. This definition is for general educational purposes only. It is not financial, investment, tax, legal, or medical advice, and it does not recommend any product or course of action. For decisions about your own situation, consult a qualified professional.