Basic Financial Statements

The basics of financial statements starts with a Balance Sheet.  It represents what you own (Assets), what you owe (Liabilities), and what you’re worth (Equity).  Here is a very basic example of a Balance Sheet.

Assets:

Cash in checking account                                              $12,000

Cash in Security Deposit Account                                   8,250

Total Current Assets                $20,250

Office Furniture/Equipment                                             1,500

Real Estate – 123 Main Street (Book Value)                73,500

Real Estate – 456 Elm Street (Book Value)                 125,000

Real Estate – 789 Oak Street (Book Value)                 320,000

Total Non-Current Assets    $520,000

Total Assets                                                                      $540,250

 

Liabilities:

Accounts Payable (Bills due)                                         $1,450

Security Deposit Liability                                                 8,250

Total Current Liability            $9,700

Real Estate Mortgage – 123 Main Street                     52,325

Real Estate Mortgage – 456 Elm Street                      75,000

Real Estate Mortgage – 789 Oak Street                    200,500

Total Non-Current Liability   $327,825

Total Liabilities                                                             $337,525

Total Equity (Assets minus Liabilities)                    $202,725