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Definition

Classified balance sheet

Classified balance sheet is a balance sheet that contains a number of standard classifications or sections. A classified balance sheet categorizes assets as current assets; long-term investment; property, plant, and equipment; and intangibles. Liabilities are classified as either current or long-term. There is also an owners’ equity section, which varies with the form of business organization.

These groupings help readers determine such things as (1) whether the company has enough assets to pay its debts as they come due, and (2) the claims of short-and long-term creditors on the company’s total assets.

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