What is a balance sheet used for?
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A balance sheet is a snapshot of a business's financial condition at a specific moment in time. It reflects what a company owns (assets), what it owes to outside parties (liabilities), and what it owes to the owners (owners' equity). The information in the balance sheet is used to answer questions such as, "Is the business in a good position to expand?" and "Does the business have enough cash to ride out an anticipated lull in sales?" In addition, by analyzing how a balance sheet changes over time, financial managers can identify trends and then suggest strategies to manage accounts receivable and payable in a way that is most beneficial to the company's bottom line.
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A financial institution is an intermediary that channels the savings of individuals, businesses, and governments into loans or investments
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