The Balance Sheet
by David Bazile
From Ask the Expert:
Hello Kate! When creating the balance sheet for the prior year, how do you calculate the assets when all you have is bank statements, the tax return of that year and receipts?
To set up a quick Balance Sheet, you know you have cash, which is an Asset. If the business is strictly on a cash basis, and there are no loans on the books, your corresponding credit to offset your Checking Account balance (a debit) will be an equity account - like Owners Equity. That's if the biz is a sole proprietorship (one owner not incorporated).
If it's a corporation, you will have Common Stock and Retained Earnings.
Does that help?