Balance Sheet Terms

Cash

This includes money in bank accounts and cash equivalents like short-term investments that can be turned into cash quickly.

Accounts Receivable

This is money the company will collect from customers who bought goods or services but haven’t paid yet.

Inventory

This includes all items a company plans to sell, from raw materials to completed products ready for sale.

Property, Plant, and Equipment (PP&E)

These are tangible assets like land, buildings, and machinery that help run the business. Everything except land loses value over time.

Accounts Payable

Bills the company needs to pay to suppliers for goods or services already received.

Long-term Debt

Loans, bonds, and other debts that the company will pay back over several years.

Accrued Expenses

Money owed for things like employee wages or utilities that were used but not yet paid for.

Retained Earnings

The total amount of net income the company has earned and kept over the years, rather than paying it out as dividends.

Additional Paid-in Capital

Extra money shareholders paid above the stated value of the stock when they invested in the company.

Assets = Liabilities + Equity

This means everything the company owns must equal what it owes plus what belongs to the owners.

Capital

Owner’s investment in a company.