PRO also includes a visual tutorial, business forms, and exam questions that will help you learn and retain information on the balance sheet. They are the resources of the company that have been acquired through transactions, and have future economic value that can be measured and expressed in dollars.Assets also include costs paid in advance that have not yet expired, such as prepaid advertising, prepaid insurance, prepaid legal fees, and prepaid rent.If you were on a previous page on the Philips website, you can return to that page by clicking your browser’s back button.
For example, let's say a company acquires 40 acres of land in the year 1950 at a cost of $20,000.
Then, in 1990, it pays $400,000 for an adjacent 40-acre parcel.
In Part 1 we will explain the components of the balance sheet and in Part 2 we will present a sample balance sheet.
If you are interested in balance sheet analysis, that is included in the Explanation of Financial Ratios.
This is valuable information to the banker who wants to determine whether or not a company qualifies for additional credit or loans.