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How to Make a Consolidated Balance Sheet
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The accuracy of your input is paramount in ensuring that the balance sheet itself is correct. In this column, find the sum of all amounts in that row, being sure to add and subtract debits and credits from your duplication column appropriately. A standalone balance sheet explicitly indicates which assets and liabilities belong to the parent company, whereas a consolidated balance sheet represents both the parent and subsidiary company. A balance sheet is relatively straightforward as financial statements go. Once you have finished inputting the numbers from your worksheet, check your consolidated balance sheet. Within the assets segment, accounts are listed from top to bottom in order of their liquidity, that is, the ease with which they can be converted into cash. For this reason, the balance sheet should be compared with those of previous periods. To create the worksheet, you will need the financials of the parent company and its subsidiary to be initially separate. The debits and credits you eliminate will need to balance out to zero. Investors also typically need to have access to this information to determine the value of their participation in your business. They are divided into current assets, those which can be converted to cash in one year or less; and non-current or long-term assets, which cannot. Typically, to create a consolidated balance sheet, you will need to start with a worksheet.
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First of all, the parent company likely includes the purchase of the subsidiary among its liabilities and this could be confusing if it's included on a parent-company-only balance sheet. This is because a balance sheet requires information from only a trial balance, income statement and cash flow statement which is then summarized in two columns, one each for assets and liabilities. They are typically prepared quarterly and are important for strategic planning and protection from audits.