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We are starting a small homekill butchery business. I need…

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We are starting a small...
We are starting a small homekill butchery business. I need some help with the Balance Sheet. So far we have used our own funds to purchase equipment and other items required. I have listed that on Balance sheet as Capital Invested (e.g. $20,000). Large Equipment is listed as Capital Expenditure $13000 and I have depreciated according to date purchased . Other items classed as expenses come to a total of $7000. These are small items like scales/buckets/ repairs/Business cards etc.
My question is where do I show the expenses or how do I account for them on the balance sheet. My Balance sheet looks something like this:
Assets
Current Liabilities
Cash $7000
Capital Equipment $13,000 Stockholders Equity $20,000
But the $7000 cash has been spent on expenses - so where do I allocate it?
Many Thanks
Submitted: 3 years ago.Category: Finance
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6/23/2015
Financial Professional: Rakhi Vasavada, Financial and Legal Consultant replied 3 years ago
Rakhi Vasavada
Rakhi Vasavada, Financial and Legal Consultant
Category: Finance
Satisfied Customers: 4,553
Experience: Graduated in law with Emphasis on Finance and have have been working in financial sector for over 12 Years
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Dear Friend,Hello and welcome. Thank you for providing an opportunity to assist you.These expenses will NOT appear in balance sheet. You will have to expense them at actuals. Having said this, for example, if you have spend for repairs, such expenses are non-recurring revenue expenditures. So, they will be shown as expense in the Profit and Loss account. The business cards == you will have to reimburse yourself for the expenses that you have made using your cards.The items like buckets, scales, etc. would be listed as ASSETS in your balance sheet. The items can be listed in the balance sheet as assets even if they are small. They have useful life over the years. So, expenses will all go into the profit and loss account as I explained above. I am sure this would help. I wish you good luck.You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.Warm Regards,
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Customer reply replied 3 years ago
Thanks. I'm still unclear as to how do I get the balance sheet to balance?
So how is the money that is expensed at actuals ($7000) accounted for in the balance sheet?
Financial Professional: Rakhi Vasavada, Financial and Legal Consultant replied 3 years ago
Dear Friend,
Hello and welcome again. Thanks for your reply.
Cash that is expensed will NOT be accounted for in Balance Sheet. It will be expensed in Profit and Loss Account and therefore will have its resultant effect on the balance sheet.
It will reduce your surplus if any, or increase the deficit if any.
I am sure this would help. I wish you good luck.
You may please leave a positive rating if this helps as this is the only way we are compensated for assisting you. Alternatively, you may revert back with a reply if you need further assistance or if I have missed out on any aspect of your question.
Warm Regards,
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