Total assets = Current assets + Investment + Fixed assets

+ Intangibles
Current assets = All assets of the company that will not
remain with the company for more than a year
Current asset = Cash + bank balances + Receivables +
sundry debtors + Inventory
Cash and bank balances = Cash held
Inventory = All the assets which are ready or will be
ready for sale but have not been sold off yet.
Inventory = Raw material + Stock in progress + Finished
goods inventory + A dvanced payments
Advance payments or prepayments = It is the assets for
which company has not received service or product yet.

Investments = It is for more than 1 year , if it is for less

than a year it is accounted as current assets
Fixed asset = Any asset in which company puts money
for more than 1 year
Gross Block = Amount of money paid initially towards
buying all fixed assets
Accumulated depreciation = Let suppose you have
bought a machine at 100 rs. and its useful for 10 years,
then every year it will depreciate by 10 rs..
Net block = gross block - accumulated depreciation

Intangible = Legal intangible + Competitive intangible

Legal intangible = Copyrights + Patents + trade secrets
(Customer list)

Competitive Intangible = it is legally non-ownable but

directly effects the competitiveness, effectiveness ,
productivity of the company

Total liabilities = Share holder's equity + Long term

Liabilities + Current liabilities

Current liabilities = All the funds the company has

received which has to be repaid within a year.

Current liabilities = Sundry creditors + Interest accrued

+ provision for taxes + Overdrafts + Advances + Dividend
payable

Sundry Creditors or Creditors or Payables = All the

creditors who have provided their service or product to
the company but have not received their payments yet
Overdrafts = Short term loans by companies taken from
bank have to be repaid within a year.
Advances = these are the payments received for which
company has not provided product or services yet.

Any item with wo

rd provision and accrued is definitely a liabilities.
Shareholder's equity
or Net Worth of a company = Common share capital +
preference share capital + Reserve and surplus (Retained
earnings)

Profit & Loss Statement/Income

Statement
Sales/Turnover
100
Less: Cost of Goods Sold

70 (COGS)

Gross Profit

30

Less: SG&A

5 (Selling, General and

Administrative expenses)

EBITDA

25 (Earnings before Interest taxes,

Depreciation and Amortization)
5
20 (also called Operating Profit)
5
15
5
10 (Profit after Tax)
2
8 (Net income available to common
shareholders)

Less: Depreciation
EBIT
Less: Interest
PBT
Less: Tax
PAT
Dividends
Net Income