Wednesday, July 6, 2011

Finance and Management - 6

In the earlier blog, we put up a rough structure to the various components in a balance sheet, but we haven’t explained the various headings. While it is pretty logical to understand these from common parlance, explaining them here would add to the context.

  • Cash - the cash is the revenue that is earned by the company
  • Receivables - are outstanding (uncollected bills) amount to be collected from the customers
  • Inventory - these are finished goods that have not yet been sold
  • Fixed Assets - includes the investment of money into plant and machinery
  • Account Payable - the payment to be done to suppliers etc
  • Notes Payable - some of the promissory notes (like cheques etc) that are to be paid up
  • Long Term Debt - Long term loan that might have been taken from banks, and have been invested in the business
  • Owner's Equity - this includes the initial capital generated by the promoters, (share holder also later on)

Read in Kannada:

No comments:

Post a Comment