What does a balance sheet typically show?

A balance sheet is a financial statement that provides a snapshot of an entity's financial position at a specific point in time. It details the company's assets, liabilities, and equity, allowing stakeholders to assess the overall financial health and stability of the business. By presenting a summary of what the company owns and owes, the balance sheet enables users to evaluate the company’s liquidity and capital structure, making it a crucial tool for investors, creditors, and management in understanding the company's financial status.

In contrast, other options describe different types of financial documents or analyses. The movement of cash over a period refers to a cash flow statement, which tracks the inflow and outflow of cash, highlighting the company’s liquidity over time. The performance of the business is typically assessed through an income statement, which reflects revenues earned and expenses incurred over a certain period, ultimately showing profit or loss. Future financial projections are generally presented in forecasts or budgets, detailing expected revenues and expenses, which assist in strategic planning.