What is Balance-Sheet?
1- What is Balance Sheet?
Balance sheet (bilancia in Italian and bilanx in Latin meaning scales) is the tables published at the end of the year of a company regarding its periodic transactions.
2- What is Balance Sheet Equation?
Balance Sheet Equation is assets are equivalent to capital plus debts.
It is the abstract account of a specific institution that shows institution’s assets and transactions.
The total of the assets column and liabilities column is always equivalent to each other.
3- Does balance sheet shows from which source asset is obtained?
The equality stems from the answered question of whether the source of attaining asset is from equity or debt.
Equity is calculated as Debts removed assets.
4- Who is the one laid the foundation of this system?
An Italian ecclesiastic man named Luca is the one who laid the foundation of this system.
Fra Luca Bartemole de Pacioli (sometimes refereed as Paciolo) 1445-1514-1517 Italian Mathematician. Since his childhood, he was very curious, and his world of numbers and shaped were mesmerized by mathematic. At the age of ability to decide, he chose becoming an ecclesiastic in the abbey where he can learn mathematics without having economic disparity. His priest friends, were respected since it was easy for them to get in houses. With the recommendation of his friends’ mothers and fathers, Luca became a mathematic lecturer. He became a mathematics professor in Venice, Minorit, Perugia, Napoli, Mailand and Florence. He met with Leonardo Da Vinci in Florence and made friends with him on the basis of mathematic comradeship.
Double sided registration in accounting is published for the first time in a book titled “Summa de Arithmetica, Geometria, Proportioni et Proportionalita” in 1494 in Venice.”Particularis di compitus e scripturis” a part from the book which is a specific part for the Essentials of double sided registration.
The practice of the last two century regarding registration is narrated systematically.
Even though this book is considered to be the first study specific to this subject, the actual first study on this subject is “Risale-i Felekiyye/Kitab-us Siyagat” written by İbn Muhammed İbn Kiya Al Mazandarani. In this book, written Persian, the basic elements of contemporary accounting such as; “Rüznamçe”, Evârece” “Tahvilat” were narrated.
5- How many groups in which balance sheet are accumulated?
Accounting plan accumulates balance sheet in five groups.
1-Current Assets
2- Non-current Assets
3- Short term liabilities
4- Long term liabilities
5- Shareholder’s equity
6– Which groups are in the active part of the balance sheet?
1- Current Assets
2- Non-current Assets
7- Which groups are in the passive part of the balance sheet?
3- Short term liabilities
4- Long term liabilities
5- Shareholder’s equity
Source: Accountancy
Legal Notice: The information in this article is intended for information purposes only. It is not intended for professional information purposes specific to a person or an institution. Every institution has different requirements because of its own circumstances even though they bear a resemblance to each other. Consequently, it is your interest to consult on an expert before taking a decision based on information stated in this article and putting into practice. Neither MuhasebeNews nor related person or institutions are not responsible for any damages or losses that might occur in consequence of the use of the information in this article by private or formal, real or legal person and institutions.
