3.4 Balance Sheet – Understanding the Use & Interpreting

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Balance Sheet - Understanding the Use and Interpreting

Many contractors have the incorrect accounting structure as it relates to the balance sheet. Use these balance sheet materials to be sure the assets, liabilities and owner’s equity accounts are accurate and the deferred liability accounts are present.

The Balance Sheet Simplified and Explained

Learn what makes a balance sheet part of your financial statements and why you actually may need to view it more often as part of a managerial review process. The balance sheet is not overly complicated. As a rule it is simply a picture of where any business is at any given moment, and often times it tells us about the health of the company. We explore deferred liability accounts in this material as well, which can affect service agreements or extended warranties or guarantees.

Run Time: 26:57

The Balance Sheet and Developing an Understanding

Use the information in this article to develop a thorough understanding of the accounting balance sheet and how it applies to our contracting trades.

Sample Balance Sheet

This is an example balance sheet showing the structure of accounts for chart of accounts.