Balance sheet
A snapshot of what you own, what you owe, and what is left over.
Last reviewed 12 September 2026
Assets equal liabilities plus equity, always. The balance sheet is the only statement that shows position rather than performance.
For founders, the useful lines are cash, receivables, payables, and debt — the four that determine whether next month is comfortable.
Formula
Assets = Liabilities + Equity
Frequently asked
What is balance sheet?+
A snapshot of what you own, what you owe, and what is left over. Assets equal liabilities plus equity, always. The balance sheet is the only statement that shows position rather than performance. For founders, the useful lines are cash, receivables, payables, and debt — the four that determine whether next month is comfortable.
How do you calculate balance sheet?+
Assets = Liabilities + Equity
Why does balance sheet matter for founders?+
For founders, the useful lines are cash, receivables, payables, and debt — the four that determine whether next month is comfortable.
Related terms
Working capital
Short-term assets minus short-term liabilities — the money running your operations.
Accounts receivable (AR)
Money customers owe you for work already delivered.
Accounts payable (AP)
Money you owe suppliers for goods or services already received.
P&L (profit and loss)
A statement of revenue, costs, and profit over a period.
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