The Secret of a Triumphant Business
Every business that wants to gain success must have a careful planning system. Do not forget also the concrete execution. Projected balance sheet does exist to help you in projecting your business’ future. This balance sheet usually deals with the management of asset growth. It gives us a proper information of your business’ financial condition.
What are the Ingredients of This Balance Sheet?
As the name says, projected balance sheet tries to balance these three things. They are liabilities, capital, and assets. Assets deal with things that owned by a certain company that contains monetary worth, like cars, lands, and furniture. Then, liabilities concerns with debts and account payable. Meanwhile, things that included in capital are investments and stocks.
Organizing the Projected Balance Sheet: Step by Step
Creating a projected balance sheet might seem intimidating due to the listing and calculating process. This activity requires a meticulously-arranged set of assets, liabilities, and equity. Then, we still need to total them and divide them into different parts. What is the thing that should be projected first? Maybe this explanatory step-by-step can help you in figuring out your business’ balance sheet.
- Step 1: Start your projected balance sheet by predicting the working capital. It’s a parameter of a business’ financial state. There are some things that included in this part, like, accounts receivable, taxes payable, and prepaid expenses.
- Step 2: Inserting the projection of your business’ assets. This part should cover several items, such as fixed assets, the budget of software development, and intangible assets.
- Step 3: Project the retained earnings. It is the element that acts as a bridge between the balance sheet and statement of income. This is the source of equity.
- Step 4: Predict the equity. Most of the time, the source of equity are retained earnings and owner’s equity. Related to step 3, in order to project the retained earnings, we have to know the prediction of net-income.
- Step 5: Estimate the liability components. Most of liability components consist of these things: short-term debt, long-term debt, and account payable. To be noted, long-term debt usually remained constant, while the short-term one is flexible due to the financial policy of a business.
However, it’s worth the value. You will have a superb business planning system. Furthermore, it will bring you to the heyday of your company. From now on, you should not underestimate the power of projected balance sheet.
- 5+ Business Balance Sheet Template
- 7+ Balance Sheet Format Template
- 8+ Small Business Balance Sheet Template
- 8+ Balance Sheet Example Template
- 11+ Balance Sheet Template
- 8+ Personal Balance Sheet Template
- 4+ Real Estate Balance Sheet Template
- 11+ Church Balance Sheet Template
- 4+ Pro Forma Balance Sheet Template
- 5+ Non-Profit Sheet Template
- 8+ Prenuptial Agreement Template
- 10+ Balance Sheet Template
- 3+ Statement/Personal Financial Statement Template
- 7+ Sample Pro Forma Income Statement Template
- 6+ Accounting Manual Templates
- 10+ Balance Sheet Templates Sample
- 7+ Profit Loss Statement
- 11+ Sample Will Forms Template
- 8+ Audit Checklists Template
- 10+ Record Sheet Templates