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Balance Sheet

A balance sheet is a summary of a business' financial status.

A balance sheet is typically broken down into two columns: assets on the left side, and liabilities and equity on the right side. Balance sheets are a snapshot of a business at a specific time.

Both sides of a balance sheet should equal out in the end—meaning total assets should equal liabilities plus equity.

As a formula, a balance sheet looks like (and seeks to prove):

  • assets = liabilities + equity