Statement of Financial Position

The statement of financial position (balance sheet) shows what a business owns and owes at a point in time (Assets = Capital + Liabilities).

Structure

Non-current assets — long-term (premises, equipment), at cost less accumulated depreciation.
Current assets — inventory, receivables, bank, cash.
Current liabilities — payables, overdraft (due within a year).
Non-current liabilities — long-term loans.
Capital — opening capital + profit − drawings.

Working capital = current assets − current liabilities.