is statement of net worth for self-employed individuals is the same as balance sheet?
411271
Similar, but not necessarily so. As a sole proprietor, you can still create a balance sheet of your business. Even the self-employed separate business from personal expenses. \n\nYour net-worth will include the "value" of your business; however your balance sheet would be strictly business. Suppose you wanted to sell your sole-proprietorship (and it had some value someone would purchase), You would not provide a prospective buyer your net worth - you would provide a balance sheet, income statement, etc...
426768
Hi.\n\nYou can look at the source below for a more detailed answer, but here it is summarized:\n\nFirst, they're both essentially the same, for all intents and purposes.  However, if you really want to get nitpicky...\n\nNon-profits mean zero profits.  At the end of the year, they shouldn't have any assets in excess of their liabilities.\n\nNot-for-profits mean that they can make a profit but they're not specifically a for-profit enterprise.  Think of the American Red Cross or a local school.  They're not there to make profits for stockholders, but clearly they leave the year with more than they started with (or at least hopefully they do!).
928940
Look at the balance sheet
461793
Whatever price the current owner is asking for this business, he should be able to support with accurate financial data.\n\nAsk for the last 12 months of financial statements - Profit and Loss Statements, Balance Sheets, etc. Then pick a few months at random, and ask the owner for the supporting documentation (receipts, bank statements, invoices, check stubs, etc.). You will want to make sure that the financial statements are accurate.\n\nIf the owner of this business is unwilling or unable to provide you with this data, DO NOT BUY THIS BUSINESS.
839256
The financial statements usually contain three "statements".  They contain the Income Statement, Balance Sheet and Cash Flow Statement.  The income statement contains the revenues and expenses to determine the period's net profit.  The balance sheet is a period ending's assets, liabilities and equity.  The cash flow statement is a reconciliation of the income statement to the cash balance by backing out changes in the balance sheet and differences in cash/non-cash items. \n\nThe cash flow statement is made up of three parts: Cash flows from operating activities (CFO), cash flows from/for investing activities (CFI) and cash flows from/for financing activities (CFF).  \n\nThe CFO usually is stated using the "indirect method" (except Australia, where I've seen them use the direct method predominantly).  Indirect method starts with pre-tax profits, backs out non-cash items (e.g. depreciation), changes in working capital and takes out taxes to get to CFO.  This section is basically the cash from the "core business" of the company.  \n\nCFI is usually dominated by capital expenditures (e.g. spending on new equipment), acquisitions and cash flows in and out of equities, stocks, derivatives and other investments not deemed to be core to the business (i.e. either as capital management or outside the scope of the company's business).  \n\nCFF is usually dominated by debt proceeds/payments, dividends and new funds from equity raising (e.g. stock options, secondary placements, IPO). \n\nThis nets down to the change in cash.  You can see where cash is coming and going (e.g. is the core business losing lots of money, but they are staying afloat by raising debt?  is the company doing really well, but the company is blowing the cash is stupid investments year after year?). \n\nThe last thing is to look at the footnotes, which give you even more details on where cash came from and went. \n\nI can go on and on... but that, my friend, is how you figure out the cash flow from looking at the financial statements.
70536
I'm not an accountant, but...as an employee, you're a W9 employee(Company reports and pays taxes on you.)  As a self-employed / contract person, you are a 1040.  That is you report, file and pay ALL of your own taxes.  You will continue to pay the same rate, but, will have business deductions that you wouldn't have before and you will have to pay the full Soc. Security taxes (about 15%).  Before you and your employer shared that expense.
789907
Typically, a business is valued either using EBITDA (earnings before interest taxes and amortization) or by looking at their NPV (net present value of cash flow). It can also be valued by looking at asset size.\n\nIn this case, I would go with EBITDA since it is a service business with no assets and NPV might not be applicable since the rent roll is relatively small.
1127474
Well, you brought up a very common issue with respect to owners of corporations.  The IRS has a provision within the code that talks about 'reasonable compensation' - which means basically what it implies.  Typically, you see owners of corps paying themselves outrageous salaries and this provision puts a limit on that.  As far as underpaying owners, this provision acts in the same manner.  Therefore, if you were to be audited, the IRS would most likely rule that any distributions you may have taken are technically classified as salary, and thus, all related taxes including payroll taxes would be assessed.  So the easy way to answer your question is - NO, you do not need to pay payroll taxes if you have zero income.  BUT, the fact that you have 0 income is a flag in and of itself and you might be in line to get a letter from them inquiring about why you have no income.  From a technical standpoint, you should be paying yourself a 'reasonable comp' - which is arbitrary, but it should be in the ballpark of other taxpayers in the same business as yours.  Obviously, with a salary - you will then need to file your related payroll tax returns, etc, etc.
538720
Income statements contains information about your revenue and your expenses. When you reduce your revenue with your expenses, you'll get profit or loss. \n\nBalance sheets contains information about your assets, liabilities and capital. Your profits or loss value from the income statement will be incorporated in your capital calculation and make your capital either increasing (profit) or decreasing (loss).\n\nRetained earnings statement is generally used for accounting in corporations, where the owner is more than one. Because the owner is more than one, your income statement value has to be divided for each owner at the last month of your accounting period. To make it not confused with your current income statement which will keep changing at time to time, your income statement value at the last month of the period is transferred to the retained earnings statement.\n\nThe statement of cash flows will calculate the difference between your cash in and cash out. The difference will be considered as the amount of your available cash right now (either in your bank or in your pocket). It will be included in your balance sheets calculation as assets.
708698
If it is a public company, they are required to file quarterly financial statements with the Securities and Exchange Commission (www.sec.gov).  Look for your Company and their Form 10-Q or Form 10-K filing.\n\nIf it is a private company, you can not other than by getting a look at the bank statement or asking accounting.  There is no publically available information for a private company's cash account.
874325
no.  enterprise value is equal to market value + debt + preferred stock - cash.  It is basically what a person who have to pay for the company if he were to buy it at current market value.
1124623
The statement of retained earnings shows the changes in the retained earnings account for the accounting period from operating profits, operating losses, dividends, etc.  It's related to the balance sheet because retained earnings is a balance sheet item.  It's related to the income statement because profits/losses will change the retained earnings account.  Any cash transactions in the retained earnings account will be shown on the cash flows statement.  Hope I didn't miss any!
781131
You can count it as a contribution (money in) and a distribution (money out) if you are a corp.  This has no tax consequence as you are paying yourself back. Normally start up costs are to be amortized.  If you are a sole-proprietor, you can take the profits, it's your money.
121983
Quicker Tax Preparation: As a sole proprietor, filing your taxes is generally easier than a corporation.Simply file an individual income tax return (IRS Form 1040) including your business losses and profits. Your individual and business income are considered the same and self-employed tax implications will apply.\n\n\nLower Start-up Costs: Limited capital is a reality for many startups and small businesses. The costs of setting up and operating a corporation involves higher set-up fees and special forms. It's also not uncommon for a lawyer to be involved in forming a corporation.\n\n\nEase of Money Handling: Handling money for the business is easier than other legal business structures. No payroll set-up is required to pay yourself. To make it even easier, set up a separate bank account to keep your business funds separate and avoid co-mingling personal and business activities.
182584
Basic statements and templates can be gotten with MS Money or Quicken..   Quickbooks has a more complete set.  You can set up model businesses and experiment with these as well as actually tracking your own accounts.
479583
A Balance Sheet is a snapshot of a company's financial position at a given point in time. The basic Balance Sheet equation is ASSETS = LIABILITIES. Broadly, the Assets are properties and other things of value which the company owns and claims against others; the Liabilities are the financial obligations of the company. In law, the company is a separate legal entity. Thus, for instance if A owns 100% of the shares of a company (a limited liability company), since the company is legally, a totally separate entity from A, A's shareholdings in the company, is a financial obligation of the company and is thus a liability of the company. So for the company (i.e. on the books of the company), the OWNER'S EQUITY is a liability to the company. On the books it is represented as a separate entity.  Thus, the balance sheet equation is written: ASSETS = LIABILITIES + OWNER'S EQUITY, i.e. A = L + OE.\n\nNow, OE has two elements, (i) CAPITAL --- essentially the funds which the shareholders inject into the company and (ii)RETAINED EARNINGS ----- these are funds which are retained in the company in lieu of being paid to the shareholders as dividends. The RE plus the dividends would be, at the end of an acounting period, the company earnings for that accounting period.  RE are cumulative, time period to time period. Of course, the company earnings are, in fact, a financial obligation of the company in favor of the shareholders. So if they are not paid to the shareholders at the end of the accounting period, i.e. if they are retained in the company, they are a liability to the company. So we get: A = L + OE becomes A = L + C + RE.  This is the basic balance sheet equation.\n\nNow, as said, the RE come from the EARNINGS (the INCOME). Basically, the INCOME is the difference between the REVENUES and EXPENSES. That is, INCOME = REVENUES - EXPENSES. This is, essentially, the Income Statement equation. Now, assuming no dividends paid, then RETAINED EARNINGS = REVENUES - EXPENSES.  Thus A = L + C + RE, where, NOTE, RE means retained earnings,  becomes:\n\n       A = L + C + R - E  i.e.\n\nAssets = Liabilities + Capital + Revenues - Expenses.\n\nNow this can be written, to make all signs in the equation positive:  A + E = L + C + R.  This is the combined Balance Sheet and Income Statement equation.  This equation shows the 5 basic types of accounts in Accounting. It also highlights something else. Expenses are handled, in the Ledger, as are Assets.  Capital and Revenue items are handled as are Liabilities.  "Handled" here refers to how the Dual Entry System of Accounting works. The basic concept which applies here is that for each transaction in which a company is involved, the total value of the DEBITS must equal the total value of the CREDITS. Now, in accounting, a DEBIT is nothing more than a left hand entry in a "T" account in the Ledger.  A CREDIT is nothing more than a right hand entry. That's it. No more, no less.\nNow, an increase in an asset is a debit, so dec. in asset is a credit, and a dec. in liability is a debit and an inc. in a liability is a credit.  So one merely has to remember one of these, e.g. an increase in an asset is a debit.\n\nNow, recall, expenses are handled as assets. So an increase in an expense is a debit.  Also capital accounts and revenues are handled as liabilities. So, an increase in a capital account or a revenue is a credit.\n\nThese are the principles employed to balance the books. The balanced books provide the numbers that are transferred to the Balance Sheet to the various Asset (Short term and Lond term Assets), Liability (Short term and Long term) and Capital items.  The asset items are normally set up on the left hand side of the bal. sht. and the liability and capital items on the right hand side, with liability items laid out above capital items.  For short and long term assets and liabilities, the short term items are laid out above the long term items. Any basic acco
932314
When I review a prospective business plan, I like to see current audited financials if they have a revenue stream. If it is a new start-up, then i'd like to see 5 years of financial projections with comps from similar businesses in the same industry. Everything should be quantified as much as possible.\n\n\nIf you have any questions you would like to ask, email me.\n\nGood luck!