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Why do you prepare a balance sheet?

Updated: 9/14/2023
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15y ago

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Balance Sheet exhibits the financial soundness of the comopany as a whole . It gives alomost complete picture to any party interested any type of relation with the company. It gives a birds eys view of assets and liabilities that company possess and Profit / Loss that company has incurred or is projected. For taking any financial decision ( Loan diisbursement , IPO investement etc.) there are some basic ratios to be calculated , balance sheet can be the base of such ratios.

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