Next video:
Loading the player...

The balance sheet is a basic accounting tool used by individuals, business owners and even large corporations to track net worth. Discover its main components and how they work together.

Related Articles
  1. Investing

    An Introduction To The Income Statement

    The income statement is a measurement of a company's financial performance over a specific period of time. Discover its main components and how they work together.
  2. Investing

    Reading the Balance Sheet

    Learn about the components of the statement of financial position and how they relate to each other.
  3. Investing

    Common Size Balance Sheet

    Investopedia explains: A common size balance sheet is a valuable tool for tracking and analyzing the changes and performance of a business over multiple time periods.
  4. Investing

    Comparing the P&L Statement and the Balance Sheet

    Basically, the balance sheet shows how much a company is worth, while the P&L statement reveals if a company is profitable or not.
  5. Investing

    Outstanding Shares

    Learn more about this important number found on a company's balance sheet.
  6. Investing

    5 Tips For Reading A Balance Sheet

    If you know how to read it, the balance sheet provides valuable information on a potential investment.
  7. Investing

    Retained Earnings

    Learn more about this calculation and why companies include it on the balance sheet.
  8. Investing

    Off-Balance-Sheet Entities: An Introduction

    The theory and practice of these entities varies greatly. Investors need to learn what they're getting into.
  9. Investing

    What Does Off-Balance Sheet Mean?

    Assets or debts that a company excludes from its balance sheet are off-balance sheet items.
Hot Definitions
  1. Leverage

    1. The use of various financial instruments or borrowed capital, such as margin, to increase the potential return of an investment. ...
  2. Trumponomics

    Trumponomics is a term for the economic policies of President Donald Trump.
  3. Universal Health Care Coverage

    An organized healthcare system that provides healthcare benefits to all persons in a specified region. Many countries, such ...
  4. Davos World Economic Forum

    The annual meeting of the World Economic Forum hosted at Davos—a small ski town in Switzerland—in January each year is among ...
  5. Smart Home

    A convenient home setup where appliances and devices can be automatically controlled remotely from anywhere in the world ...
  6. Efficient Frontier

    A set of optimal portfolios that offers the highest expected return for a defined level of risk or the lowest risk for a ...
Trading Center