Classified Balance Sheet
The classified balance sheet is subdivided as follows:
| Assets | Liabilities | |
|---|---|---|
| Current Assets | Current Liabilities | |
| Investments | Long-term Liabilities | |
| Property, Plant, & Equipment | ||
| (Other Assests) | Owner's Equity | |
| (Category depends on the form of business) |
Assets
A Current asset is an asset that can reasonably be expected to be realized in cash during the next year or normal operating cycle, whichever is longer.
Investments are long-term assets that generally are not used in the normal operation of a business.
Property, plant, and equipment are long-term assets that are used in day-to-day operations.
Intangible assets are long-term assets whose value stems from the rights or privileges they extend to the owner.
Liabilities
A current liability is a liability that can reasonably be expected to be paid during the next year or normal operating cycle, whichever is longer.
Long-term liabilities are debts that fall due more than one year ahead or beyond the normal operating cycle.
Owner's Equity
The owner's (stockholders') equity section for a corporation differs from that of a proprietorship in that it has subdivisions of:
- contributed capital (the assets invested by stockholders) and
- retained earnings (stockholders' claim to assets earned from operations and reinvested in operations).