Do small businesses need a balance sheet template?
Yes, small businesses can greatly benefit from having a balance sheet template. The balance sheet provides a snapshot of the company’s financial health at a specific point in time.
It helps with financial modeling, budgeting, and managing cash flow by informing stakeholders, owners, and leadership what the company owns (assets), what it owes (liabilities) and how much has been invested into the company (equity). The balance sheet is one of the three fundamental financial statements that every business needs.
Why use a sample balance sheet template
Using a sample balance sheet template offers several advantages for small businesses:
- Structure: Sample balance sheet templates provide a structured format with predefined sections and categories, making it easier to organize and classify assets, liabilities, and equity.
- Time-saving: You can simply customize the template by entering your specific financial data, saving you from the hassle of designing the layout and structure.
- Compliance: Sample balance sheet templates often adhere to industry standards and generally accepted accounting principles (GAAP).
- Accuracy in calculations: Many balance sheet templates come with built-in formulas and calculations, reducing the risk of errors in calculating totals and subtotals. These formulas automatically update values as you enter or modify data.
- Customization: You can add or remove categories, modify formatting, and include additional information relevant to your industry or reporting requirements.
How to prepare a balance sheet template
Here’s how to do a balance sheet in Excel:
Step 1: Download balance sheet Excel template.
Step 2: Determine balance sheet date.
Step 3: Pull in trial balance report data for current and prior periods.
Step 4: Update account types.
Step 5: Verify balance sheet is in balance.
You can find more detailed instructions on how to use our balance sheet when you download the template.
FAQ:
What is the purpose of a balance sheet template?
The balance sheet is used internally and externally for different purposes. Internally, the company uses the balance sheet to understand whether the business is succeeding or struggling by analyzing the liquidity position of the company.
Externally, the balance sheet is a tool for investors, stakeholders and regulators to evaluate the financial position of the company, determine how the business was financed, and determine if the company is a smart investment.
What information does a balance sheet template include?
The balance sheet follows the fundamental accounting equation: Assets = Liabilities + Equity.
Therefore, the typical information that can be found in a balance sheet includes:
- Company information
- Date
- Assets
- Current assets
- Fixed assets
- Intangible assets
- Liabilities
- Current liabilities
- Long-term liabilities
- Equity
- Shareholder’s equity
- Totals and subtotals of assets, liabilities, and equity
Can this balance sheet template be used in Google Sheets?
Yes, download our balance sheet Excel template. Then in Google Sheets, follow these steps:
- Create a new or open an existing spreadsheet.
- Click File. Import.
- Choose the Excel balance sheet template file and click Select.
- Choose an import location option:
Create new spreadsheet,
Insert new sheet(s),
or Replace spreadsheet. - Click Import data and you should have this balance sheet template in Google Sheets.
