OMM 622
Balance Sheet – Ford Motor Company
The University of Arizona Global Campus
OMM 622 Financial Decision-Making
Balance Sheet – Ford Motor Company
A balance sheet is a financial statement that shows the assets, liabilities, and Equity of a
corporation at a certain point in time. It shows the assets (what the company owns), liabilities
(what it owes), and equity of the company (what claims investors have on the assets). The assets
are listed on the debit side of the balance sheet, while liabilities and Equity are listed on the
credit side, and the two sides must be equal or balanced. This article will look at the function of a
balance sheet and analyze the Ford Motor Company's balance sheet from its 2012 Annual
Report. Financial ratios will be calculated and benchmarked against industry norms.
The Purpose of a Balance Sheet
According to Mikhalyonok (2019), "The company's balance sheet is one of the most
important kinds of reporting since it includes all commercial organizations, including legal
companies. This type of reporting reflects the structure and content of the organization's property,
as well as the sources of such property, as of the reporting date" (para.1). The balance sheet
allows a wide range of accounting users to assess and analyze the company's financial and
property position. Since balance sheet data are the most important analytical tool, one of the
essential functions of the balance sheet is its informativeness.
"The purpose of the balance sheet is basically to reveal the financial status of an
organization, but users may focus on different information within the statement, depending on
their own needs" (Bragg, 2021, para.6). Investors examine a company's balance sheets to
estimate its worth. Assets, inventory, accounts receivable, current liabilities, and equity help
provide a picture of a year's growth or losses. This data can also be used to compare past years
Balance Sheet – Ford Motor Company
The University of Arizona Global Campus
OMM 622 Financial Decision-Making
Balance Sheet – Ford Motor Company
A balance sheet is a financial statement that shows the assets, liabilities, and Equity of a
corporation at a certain point in time. It shows the assets (what the company owns), liabilities
(what it owes), and equity of the company (what claims investors have on the assets). The assets
are listed on the debit side of the balance sheet, while liabilities and Equity are listed on the
credit side, and the two sides must be equal or balanced. This article will look at the function of a
balance sheet and analyze the Ford Motor Company's balance sheet from its 2012 Annual
Report. Financial ratios will be calculated and benchmarked against industry norms.
The Purpose of a Balance Sheet
According to Mikhalyonok (2019), "The company's balance sheet is one of the most
important kinds of reporting since it includes all commercial organizations, including legal
companies. This type of reporting reflects the structure and content of the organization's property,
as well as the sources of such property, as of the reporting date" (para.1). The balance sheet
allows a wide range of accounting users to assess and analyze the company's financial and
property position. Since balance sheet data are the most important analytical tool, one of the
essential functions of the balance sheet is its informativeness.
"The purpose of the balance sheet is basically to reveal the financial status of an
organization, but users may focus on different information within the statement, depending on
their own needs" (Bragg, 2021, para.6). Investors examine a company's balance sheets to
estimate its worth. Assets, inventory, accounts receivable, current liabilities, and equity help
provide a picture of a year's growth or losses. This data can also be used to compare past years
