It gives information about the current financial condition of the business.
  • It gives a broad picture of the value of the assets like accounts receivable, inventory and fixed assets, cash balances, etc.
  • It displays the amount of debt the business owes to all the creditors
  • It also measures the solvency of any business. The business is regarded as a solvent when the assets exceed the business liabilities.
  • It also shows whether the business is over-trading or under-trading
BY Best Interview Question ON 09 Apr 2019