Chapter

Understanding the Balance Sheet

Hrishikes Bhattacharya

in Banking Strategy, Credit Appraisal, and Lending Decisions

Second edition

Published in print October 2011 | ISBN: 9780198074106
Published online September 2012 | e-ISBN: 9780199080861 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780198074106.003.0011
Understanding the Balance Sheet

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A balance sheet indicates the state of a business as on a particular date. Along with a profit and loss account it tells us how the funds flowed through the business during a given period. This chapter discusses the trial balance and treatment of closing stock, the classification of accounts and the balance sheet and its format. The balance sheet is a total concept which helps the banker not only to see if the loan stands secured but also to examine whether the value of the business is increasing.

Keywords: trial balance; closing stock; stock register; accounts; balance sheet; net worth; capital; non-corporate borrowers

Chapter.  13605 words. 

Subjects: Financial Markets

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