Owners use a balance sheet to show an organization’s financial position at a specific date. It helps to summarize an organization’s value. The balance sheet presents a listing of assets, liabilities and owner’s equity. It’s called a balance sheet because assets equal liabilities plus owner equity. The numbers must balance.
This is the most accepted method to list the value of a shared airplane ownership. It shows what the company owns as well as what it owes. In this series, we’ll review how to prepare and present the balance sheet in a shared ownership.
Example Balance Sheet Classifications
Cirrus-We-Own, LLC: Balance Sheet, May 31,2016
|ASSETS||LIABILITIES & OWNERS EQUITY|
|Cash & Receivables||8,517||Credit Cards||690.55|
|Funded Reserves||19,000||Other Payables|
|Aircraft: Cirrus SR22||230,600||Capital Accounts|
|Member – Jones||87,323|
|Member – Smith||87,323|
|Member – Brown||87,323|
|Total Assets||$262,660||Total Liabilities||$262,660|
Next week we’ll review assets listed on the balance sheet in more detail.
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