Do You Know the Net Worth of Your Business?
An article from the Kashoo blog
Posted by: RE Technology
Guest contributor Kashoo says:
The United States Small Business Administration (SBA) generally classifies a "small business" as having less than 500 employees and about $50 million in annual sales. Here at Kashoo, we specialize in working with freelancers, solo practitioners, SOHO (Small Office Home Office) owners, and small businesses—none of which even register on the SBA's Size Standards Table. But no matter what the size of your business, it is important for you to know its net worth and you can calculate your company's net worth using the reports generated from your online small business accounting software—Kashoo is real accounting for real small businesses like ours!
The net worth of your business is different from its market value because to calculate the net worth, all of the assets, liabilities, and equity listed on your balance sheet are reported as historical costs. Business owners often use their net worth when applying for financing from banks and other lending institutions.