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  • Talk 3. Balance Sheet

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    Joy Superales Salao
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    The balance sheet shows a company's financial position as of a specific date. It lists assets owned by the company, classified as current within one year or non-current beyond one year. Assets can be passive investments like real estate or bonds, or income generating assets. The balance sheet also lists company liabilities as current within one year or non-current beyond one year. For personal finance, debt can be bad if incurring interest but not generating income, or good if incurring interest but also generating inflows to the business. The balance sheet of a poor or middle class person focuses more on bad debt versus income generating assets, while a rich person's balance sheet focuses more on income generating assets versus bad debt.

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    The balance sheet shows a company's financial position as of a specific date. It lists assets owned by the company, classified as current within one year or non-current beyond one year. Assets can be passive investments like real estate or bonds, or income generating assets. The balance sheet also lists company liabilities as current within one year or non-current beyond one year. For personal finance, debt can be bad if incurring interest but not generating income, or good if incurring interest but also generating inflows to the business. The balance sheet of a poor or middle class person focuses more on bad debt versus income generating assets, while a rich person's balance sheet focuses more on income generating assets versus bad debt.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    17 views8 pages

    Talk 3. Balance Sheet

    Uploaded by

    Joy Superales Salao
    The balance sheet shows a company's financial position as of a specific date. It lists assets owned by the company, classified as current within one year or non-current beyond one year. Assets can be passive investments like real estate or bonds, or income generating assets. The balance sheet also lists company liabilities as current within one year or non-current beyond one year. For personal finance, debt can be bad if incurring interest but not generating income, or good if incurring interest but also generating inflows to the business. The balance sheet of a poor or middle class person focuses more on bad debt versus income generating assets, while a rich person's balance sheet focuses more on income generating assets versus bad debt.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    of 8

    BALANCE SHEET

    Financial Position

    BALANCE SHEET

    Financial position as of date

    ASSET WHAT THE COMPANY


    OWN

    Classification (historical cost)


    Operating cycle/business cycle (or economic cycle or
    boombust cycle) refers to aggregate production,
    trade and activity over several months or years in a
    market
    Current

    within the course of the operating cycle or one


    year whichever is shorter, liquidity
    Non-Current beyond one year, fixed asset,

    Personal Finance (at market value)


    Passive

    Sample real estate, bonds,

    Dead

    Income Generating (PIG) Asset

    Investment depreciates and not PIG, curse, why?

    Sample gadgets/equipments not used in business, house.

    LIABILITY- WHAT THE COMPANY


    OWE
    Company

    Liability Classification

    Non-Current
    Current

    Personal Finance
    Bad

    Debt incurring interest expense

    House mortgage, vehicle mortgage not used in


    business.

    Good

    Debt incurring interest expense but also


    generating inflows.

    Sample loan invested to business, stocks, mutual


    fund, need of business.

    POOR/MIDDLE CLASS BALANCE


    SHEET

    Good
    Debt

    Pig
    Non-Pig

    Bad Debt

    RICH BALANCE SHEET

    Non-PIG
    PIG

    Bad Debt
    Good Debt

    SAMPLE CHART OF ACCOUNTS

    Cash on Hand
    Savings account
    Time Deposit

    WORKSHOP

    Decide on your operating cycle of business.


    Identify and sum up PIG, get the %age
    Identify and sum up non-PIG, get the %age
    Think on how to turn non-pig to pig.
    List

    down procedures.
    List down relevant cash outflow to turn pig to
    non-pig

    Identify bad debts and good debts


    Maturity of the liabilities.
    Celebrate your freedom from your bad debts.

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