Welcome Back

                        In today's post, we will solve a sole trader balance sheet example with all information.

Running a business as a sole trader requires a keen understanding of financial management in which the balance sheet stands tall. If you are an accounting student and make a balance sheet for a solo trader then this example will help you.

Importance of Maintaining a Balance Sheet for Sole Traders

Before I explain the example of a sole trader's balance sheet, let me explain what are the important points I should check to solve this example.

Identifying AssetsListing assets and accurately valuing them form the foundation of the balance sheet.
Calculation of LiabilitiesClear identification and calculation of liabilities help in ascertaining the actual obligations.
Determination of EquityEquity calculations involve subtracting liabilities from assets and highlighting the owner's investments.

Sole Trader Balance Sheet Example

Balance Sheet of a Sole Trader

AssetsLiabilities & Equity
Current Assets:Current Liabilities:
Cash20,000Accounts Payable8,000
Accounts Receivable15,000Short-Term Loans Payable5,000
Prepaid Expenses3,000
Total Current Assets63,000Total Current Liabilities13,000
Non-Current Assets:Non-Current Liabilities:
Equipment30,000Long-Term Loans Payable20,000
Furniture & Fixtures15,000
Total Non-Current Assets45,000Total Non-Current Liabilities20,000
Total Assets108,000Total Liabilities33,000
Owner's Equity:
Capital (Investment)75,000
Retained Earnings0
Total Owner's Equity75,000
Total Liabilities & Owner's Equity108,000Total Liabilities & Owner's Equity108,000

I hope you can find Assets, Liabilities, and Owner's Equity.

In this given example total assets ($108,000) are equal to total liabilities (Assets = Liabilities + Owner's Equity).


Here in this post, we solve a sole trader balance sheet example so if you are an accounting student then you should read this post till the end.