Accounting Terms for a Balance Sheet

The following items are the primary terms for a balance sheet, followed by an explanation of what each of these items are.

Assets

Assets are what the company or the individual owns. Balance sheets are most frequently used by companies, but we have included the term "individual" here as well. Perhaps you are in the field of accounting or finance, and you create your own balance sheets for the home. Examples of assets include:

Cash
Petty Cash
Temporary Investments
Accounts Receivable
Supplies
Land
Inventory
Buildings
Bond Issues Costs

Liabilities

The term liabilities means any money that the company owes. In general, we are talking about the amount that the company owes to creditors. There might be other types of liabilities for a company though; therefore, it is also best to consult with an accountant about these issues. For example, if your company has received payment for a good or service that has not yet been issued, that might count as a liability. Examples of liabilities in companies include:

Accounts Payable
Salaries Payable
Customer Deposits
Income Taxes Payable
Notes Payable
Wages Payable
Lawsuits Payable
Bonds Payable

Owner's Equity

Owner's equity refers to the source of the company's assets. Where do they come from? Another way of expressing "Owner's equity" is to say the Book Value of the Company because it is equal to the reported assets minus the reported liabilities. Examples of equity accounts include:

Preferred Stock
Common Stock
Retained Earnings

Now you have a brief overview of accounting terms that you will find on a balance sheet.

Accounting Terms for a Balance Sheet