3 Steps to Perform Balance Sheet Analysis in Corporate Finance Assignment


Corporate Finance is an important area of study for students pursuing financial studies. It basically includes various methods in which corporate can do short term and long term financial planning for maximizing shareholder’s value and achieve organizational goals. Managing a corporate and its finances is not an easy task. Skilled managers are those who perform an accurate analysis of firm’s assets, liabilities, and equity through its important financial statements, such as its balance sheet.



This is very well understood by the professors teaching students at higher academic levels. So, they ask students to write Corporate Finance assignments. However, many students get stuck when asked to analyse the balance sheet and financial position of the firm given in their assignment task. If you are also facing the same challenges, then just read this write-up by corporate finance assignment help experts of Global Assignment Help where they have highlighted 3 steps to perform an accurate balance sheet analysis to help you best in this regard. Have a look.

Step 1: Learn about the balance sheet equation
Before analyzing the balance sheet, you must know about the basic equation. The balance sheet equation is as follows:

Assets = Liabilities + Shareholder’s Equity

This equation simply means that there are two major capital sources for creating assets of the company. These are the borrowings and the capital investment made by the shareholder.

Step 2: Know about components of balance sheet equation

 As per our corporate finance assignment help expert, you should know about all the major components of balance sheet equation. The first one is assets which include current assets, such as cash and cash equivalents, accounts receivable, inventory and non-current assets like machinery, computers, buildings, land, patents, and copyrights. The second component is the liabilities which include short-term, long-term and current liabilities and the final component is shareholder’s equity. It is the initial investment made by the business owners to run the business.

Step 3: Check if the basic equation balances

Calculate the sum of all the liabilities and shareholder’s equity. This sum should be equal to the value of total assets. This indicates that all the entries made are accurate. After this step, compare the total assets with the total liabilities, if the total assets are greater than the total liabilities then the company is having a good financial position.

Follow these three steps to analyse the balance sheet in the most appropriate manner provided in your corporate finance assignment. But, if you are still facing difficulties in the assignment writing process, then seek the best assignment help service form the expert writers of Global Assignment Help. Hurry up! Join us today.

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