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    Entrepreneur's Avatar
    Entrepreneur Posts: 1, Reputation: 1
    New Member

    Jan 30, 2007, 06:53 AM
    Interlocking Balance Sheet and Income Statement

    I'm starting a company and have prepared a four-year proforma statement of income. Now I need to prepare proforma balance sheets and statements of cash flow. I know that current retained earnings less previous retained earnings from the balance sheet equal current net income from the income statement. However, I've never created a balance sheet "from scratch."

    I don't know how to take my information from the projected income statement to populate the balance sheet. Do you know how to approach this process or do you have a recommended website?

    Thank you,
    CaptainForest's Avatar
    CaptainForest Posts: 3,645, Reputation: 393
    Ultra Member

    Jan 30, 2007, 10:09 PM
    Take a look at this website for general information on certain things related to accounting, such as Financial Statements (Balance Sheet, Income Statement, etc.)


    Balance Sheet.

    Basically, list all of your assets (cash, accounts receivable, supplies, land, building, equipment, etc.)

    Then list all of your liabilities (accounts payable, bank loan, unearned revenue).

    Then the difference will be the equity that you have in the company.

    Actually, Reading The Balance Sheet would probably be a better website to look at for a more in depth look at the balance sheet. The first link is more of a general website for all accounting needs and how to do a trial balance and basic journal entries.

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