To succeed in BUS FPX 4015 Assessment 2, students must first grasp the structure and purpose of these financial statements, as well as the principles that govern their creation. Understanding the fundamentals of financial reporting—what the numbers mean and how they interconnect—is essential for performing well in both academic assessments and real-world business environments. Each statement provides a different perspective on the financial activities of a business, and together they offer a holistic view of the organization. The balance sheet offers a snapshot of a company’s financial position at a specific moment in time. It presents the company’s assets, liabilities, and equity. Assets represent everything the company owns, while liabilities are everything the company owes. Equity, often referred to as shareholders’ equity or owners’ equity, is the residual interest in the company’s assets after all liabilities have been deducted. A properly constructed balance sheet must always balance, meaning that assets must equal liabilities plus equity.