classified balance sheet

(noun)

a summary of a company's assets, liabilities, and equity

Related Terms

  • liabilities
  • equity
  • asset

Examples of classified balance sheet in the following topics:

  • Introduction to the Balance Sheet

    • The balance sheet is a summary of the financial balances of a company and reflects the company's solvency and financial position.
    • A classified balance sheet has the same three major categories of assets, liabilities, and stockholder's equity, but it breaks those categories down further to give a better idea of the profitability and strength of the company.
    • Both internal and external users use the balance sheet.
    • The balance sheet also demonstrates how liquid the business is.
    • Name the two types of balance sheets and identify which accounts are listed on the balance sheet
  • Reporting Long-Term Liabilities

    • Debts that become due more than one year into the future are reported as long-term liabilities on the balance sheet.
    • "Notes Payable" and "Bonds Payable" are also examples of long-term liabilities, and they often introduce an interesting distinction between current liabilities and long-term liabilities presented on a classified balance sheet.
    • On Company X's 12/31/12 balance sheet, a long-term liability for 100,000 would be reported, but what about the balance sheet as of 12/31/13?
    • Continuing one year forward, Company X would report a current liability of 20,000 and a long-term liability of 60,000 on its balance sheet as of 12/31/2014.
    • See below for the balance sheet reporting treatment of the current and long-term liability portions of the Note Payable from initiation to final payment.
  • Classifying Receivables

    • Receivables can be classified as accounts receivables, trade debtors, bills receivable, and other receivables.
    • On a company's balance sheet, receivables can be classified as accounts receivables or trade debtors, bills receivable, and other receivables (loans, settlement amounts due for non-current asset sales, rent receivables, term deposits).
    • Accounts receivable therefore can be classified according to their age.
  • Being Aware of Off-Balance-Sheet Financing

    • Off-Balance-Sheet-Financing represents rights to use assets or obligations that are not reported on balance sheets to pay liabilities.
    • Off-Balance-Sheet-Financing is associated with debt that is not reported on a company's balance sheet.
    • Furthermore, uncertain assets or liabilities are subject to being classified as "probable", "measurable" and "meaningful".
    • An example of off-balance-sheet financing is an unconsolidated subsidiary.
    • Jeffrey Skilling is the former CEO of Enron, which was notorious for it's use of off-balance-sheet-financing.
  • Types of Receivables

    • Receivables can generally be classified as accounts receivables or notes receivable, though there are other types of receivables as well.
    • Receivables can be classified as accounts receivables, notes receivable and other receivables ( loans, settlement amounts due for non-current asset sales, rent receivable, term deposits).
    • Accounts receivable usually appear on balance sheets below short-term investments and above inventory.
    • The maturity date of a note determines whether it is placed with current assets or long-term assets on the balance sheet.
    • If significant, these nontrade receivables are usually listed in separate categories on the balance sheet because each type of nontrade receivable has distinct risk factors and liquidity characteristics.
  • Amortized Cost Method

    • Debt held to maturity is shown on the balance sheet at the amortized acquisition cost.
    • Debt held to maturity is shown on the balance sheet at the amortized acquisition cost.
    • In order to record the interim interest revenue and report the investment on the balance sheet, it is necessary to prepare an amortization schedule for the debt.
    • The Z Company's investment in Tee company is shown on the balance sheet as follows:
    • Debt held to maturity is shown on the balance sheet at the amortized acquisition cost.
  • Reporting Cash

    • Cash and cash equivalents are reported in the current asset section of a business's balance sheet.
    • Cash is an asset, which means it is included in a business's balance sheet .
    • When the company's cash balance is reported on its balance sheet, all of those accounts are combined into one "cash" line item.
    • A sample balance sheet in Chinese.
    • Cash and cash equivalents are reported on the balance sheet.
  • What Goes on the Balances Sheet and What Goes in the Notes

    • The balance sheet lists current liability accounts and their balances; the notes provide explanations for the balances, which are sometimes required.
    • Of the four basic financial statements, the balance sheet is the only statement which applies to a single point in time of a company's calendar year.
    • Balance sheets are presented with assets in one section, and liabilities and equity in the other section, so that the two sections "balance. " The fundamental accounting equation is: assets = liabilities + equity ([).
    • Current liabilities and their account balances as of the date on the balance sheet are presented first, in order by due date.
    • Explain why a company would use a note to the balance sheet
  • Redeeming at Maturity

    • Bonds can be classified to coupon bonds and zero coupon bonds.
    • Unless the bond matures in a year or less it is shown on the balance sheet in the long-term liabilities section.
    • All bond discounts and premiums also appear on the balance sheet.
    • On the balance sheet, the Bonds Payable account can be shown as different issues or consolidated into a single balance.
    • Debt securities can be classified as "held-to-maturity," a "trading security," or "available-for-sale. "
  • Indefinite-Life Impairment

    • Year end calculations reveal the trademark is valued at $8 million and an impairment loss of $2 million is recorded as a debit to Loss on Trademark Impairment on the income statement and a credit to Accumulated Impairment Losses on the balance sheet (disclosed as a contra asset account to the intangible asset).
    • The carrying amount is defined as the value of the asset as displayed on the balance sheet.
    • Intangibles can also be classified as: legal intangibles or competitive intangibles.
    • When an intangible asset's impairment reverses and value is regained, the increase in value is recorded as a gain on the income statement and reduction to accumulated impairment loss on the balance sheet, up to the amount of impairment loss recorded in prior periods.
    • Increases in value in excess of prior impairment loss is debited directly to the asset and credited to a revaluation reserve account in the equity section of the balance sheet.
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