Module 1 gave you the equation that never breaks: what you own equals what you owe plus what is really yours. Now we read a full balance sheet the way a banker does — and the secret is one word printed all over it: current.
The selfie, taken properly
Here is Rosa's Pizza on 31 December — the same year whose P&L you just read:
| Rosa's Pizza — Balance Sheet at 31 Dec | $ |
|---|
| ASSETS | |
| Cash | 30,000 |
| Receivables (customers who owe us) | 50,000 |
| Inventory (ingredients in the store) | 20,000 |
| Current assets | 100,000 |
| Equipment (oven etc.) at cost | 60,000 |
| Less: accumulated depreciation | (12,000) |
| Non-current assets | 48,000 |
| Total assets | 148,000 |
| LIABILITIES | |
| Payables (we owe suppliers) | 28,000 |
| Current liabilities | 28,000 |
| Bank loan | 40,000 |
| Non-current liabilities | 40,000 |
| Total liabilities | 68,000 |
| EQUITY | |
| Owner's capital | 50,000 |
| Retained earnings | 30,000 |
| Total equity | 80,000 |
Check the equation: 148,000 = 68,000 + 80,000. Still unbreakable. ✅