Pro Forma Balance Sheet Template - Excel and Google Sheets

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Pro Forma Balance Sheet Template - Excel and Google Sheets

Simplify day-to-day data collection with easy and quick inputs. Perfect for startups or small businesses, this user-friendly template is compatible with Excel and Google Sheets. Download it today and manage your pro forma balance sheet effortlessly!

Pro Forma Balance Sheet Template - Excel and Google Sheets

Simplify day-to-day data collection with easy and quick inputs. Perfect for startups or small businesses, this user-friendly template is compatible with Excel and Google Sheets. Download it today and manage your pro forma balance sheet effortlessly!

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Introducing our versatile Pro Forma Balance Sheet Template, compatible with both Excel and Google Sheets. This easy-to-use tool collects your data through simple questions and automatically generates your balance sheet. It even provides feedback on whether it balances or not. To ensure a seamless experience, we've prepared a step-by-step video guide, eliminating any confusion in creating your balance sheet.

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Learn how to create a pro forma balance sheet in minutes

Compatible with both Excel and Google Sheets this template allows you to generate a ready-to-use balance sheet effortlessly. Just input your data as answers to the questions on the input tab.

It's perfect for small businesses seeking a loan or conducting financial reviews.


How to Create your own Pro Forma Balance Sheet Without a Template

Step 1: Format Your Pro Forma Balance Sheet - The initial task involves formatting your balance sheet. Remember, in its simplest form, the equation is Assets = Liabilities + Owner's Equity. The image below shows the fundamental line items comprising a balance sheet.


Balance Sheet

Step 2: Enter Starting Balances - Start by entering the initial balances. For instance, consider a fictitious business named Adam's Lawn Care. At the beginning, the balance sheet might appear relatively empty, as shown below. It may consist of cash in the bank, a lawnmower, and "Paid in Capital," representing the owner's initial investment into the company to purchase the lawnmower.

Balance Sheet Example

Note that the $4,500 in cash also appears in the Paid in Capital section as the owner's investment into the company.

Step 3: How Sales Impact the Balance Sheet - As the business generates sales, it impacts the balance sheet. For instance, assume Adam's Lawn Care secures contracts with five local businesses to mow their grounds, invoicing them for payment in 30 days. If each company is charged $1,000 for the first month of work, the sales amount to $5,000. However, the day after invoicing, this amount won't appear as cash on the balance sheet but rather as Accounts Receivable.

Step 4: Impact of Expenses on the Balance Sheet - As I generate sales, there will be associated expenses like fuel, oil, meals, etc. Let's assume these expenses amount to $1,000, with half paid in cash and the other half using a credit card. Let's examine how this affects my balance sheet.

Balance Sheet Example

Additionally, you'll notice that Retained Earnings increased to $4,000. Retained earnings represent the cumulative net profit or net loss. At present, my income is $5,000, and expenses amount to only $1,000, resulting in a net income of $4,000, which is reflected in the retained earnings on the balance sheet.

Step 5: How a New Loan Impacts the Balance Sheet - To illustrate, let's consider Adam's Lawn Care purchasing a small office for the business. To finance the purchase, a loan of $75,000 is obtained from the bank. Consequently, liabilities increase by the loan amount, and assets increase by the building's price, both amounting to $75,000.

New Balance Sheet Example

In summary, understanding how different transactions impact the balance sheet is crucial when creating your own financial model. Always ensure that each transaction impacting an asset is balanced by a corresponding impact on a liability or equity account, maintaining balance in your balance sheet.

Pro Forma Balance Sheet FAQs

What is a pro forma balance sheet?  

A pro forma balance sheet is a financial statement that presents a company's assets, liabilities, and equity at a specific point in time.

Does this pro forma balance sheet template work with Google Sheets?

Yes, you can easily convert this Excel template into a Google Sheets-based balance sheet template.

How to read a pro forma balance sheet?

A pro forma balance sheet displays a company's assets at the top, followed by its liabilities, and finally, the equity section at the bottom. The total assets should equal the total liabilities plus equity.

How to calculate retained earnings on a pro forma balance sheet?

Retained earnings represent the cumulative net income over the company's lifetime. For example, if the company has been in business for 10 years with a net income of $100,000 per year, the retained earnings would be $1,000,000 (10 x $100,000).

What is goodwill on a pro forma balance sheet?  

Goodwill on the balance sheet is the result of acquiring another company for more than its net asset value. For instance, if a company is acquired for $1 million, but its net asset value is $700,000, the difference of $300,000 represents goodwill. Watch our video on how to calculate goodwill for an acquisition.

What is an opening balance sheet?

An opening balance sheet is the balance sheet at the start of a specific period. For instance, if you are required to present an opening balance sheet for the beginning of the year, simply provide the historical balance sheet as of the first day of that year. However, if you are asked for an opening balance sheet for a future date, you will need to create a projected balance sheet to reflect the anticipated financial position.

What is a projected balance sheet? 

A projected balance sheet is a balance sheet created for a specific future date. If you are requested to provide a projected balance sheet for a business that you haven't started yet, our startup balance sheet template can help you generate one for day 1 of your startup. On the other hand, if you need to provide a projected balance sheet for an existing business, you will need to develop a comprehensive set of financial projections. A projected balance sheet works together with a projected income statement and cash flow projection, so you will likely need one of our 70+ projected financial models which will include up to 5 years of a projected balance sheet. Read our balance sheet forecasting guide for more details.

What is a pro forma balance sheet?

A pro forma balance sheet is essentially the same as a projected balance sheet. It involves presenting a balance sheet that reflects the financial condition of a business on a particular future date.

What is a balance sheet forecast?

A balance sheet forecast is another term used for a projected balance sheet. It entails presenting a balance sheet that represents the financial status of a business on a specific future date. To create a forecasted balance sheet, you will also need to develop projections for your income statement and cash flow statement.

What is a common size balance sheet? 

A common size balance sheet displays the relative percentage of each asset, liability, and equity line item compared to the total assets, liabilities, and equity.

How to calculate a common size balance sheet? 

To compute a common size balance sheet, follow these steps:

  1. Fill out a balance sheet template with all the asset, liability, and equity line items.
  2. Divide each asset line item by the total assets to determine the relative percentage that each asset represents of the total assets.
  3. Similarly, divide each liability and equity line item by the total liabilities and equity, respectively, to obtain the relative percentage for each line item.

By performing these calculations, you can create a common size balance sheet that provides a clearer picture of the proportionate significance of each component in relation to the total values of assets, liabilities, and equity.

Common size balance sheet example

You can see an example of a common size balance sheet below. Notice the column with the relative percentages for each line item.

How to analyze a common size balance sheet?

The significance of a common size balance sheet lies in its comparability to other companies, regardless of their size. For instance, when examining Apple's balance sheet, despite its significantly larger figures, converting it into percentages enables a meaningful comparison to assess the similarity of relative current liabilities with your own. This approach allows for meaningful financial benchmarking and insights into how your company stacks up against industry leaders, regardless of their scale.

How should I fill out a pro forma balance sheet if I am self-employed?

Fortunately, there is no substantial difference between a self-employed balance sheet and a balance sheet for a larger business. You will still need to input your assets, liabilities, and equity investments into our balance sheet template. However, a challenge for a self-employed balance sheet is that you must only include assets and liabilities directly related to the business. This highlights the importance of maintaining a separate bank account for your business, allowing you to identify the cash that belongs to the business and should be added to the self-employed balance sheet. Additionally, using a separate credit card for business expenses, rather than a personal one, enables clear tracking of business-related debt, which can be accurately reflected on your balance sheet.

What goes on a pro forma balance sheet?  

Here is a list of common categories on the balance sheet:

Assets

Current Assets

  • Cash in Bank
  • Accounts receivable
  • Inventory
  • Prepaid Expenses
  • Other Current Assets

Fixed Assets

  • Machinery & equipment
  • Furniture & fixtures
  • Leasehold improvements
  • Land & buildings
  • Other fixed assets
  • Accumulated depreciation

Other Assets

  • Intangibles
  • Deposits
  • Goodwill

Liabilities and Equity

Current Liabilities

  • Accounts payable
  • Taxes payable
  • Notes, short-term (due within 12 months) 
  • Current part, long-term debt
  • Other current liabilities

Long-term debt

  • Bank loans payable
  • Notes payable to stockholders
  • LESS: short-term portion
  • Other long term debt

Owner’s Equity

  • Invested Capital
  • Retained earnings - beginning
  • Retained earnings - current
  • Total Owners’ Equity

What are assets on a pro forma balance sheet? 

The most common asset categories to be listed on a balance sheet are:

  • Cash in Bank
  • Accounts receivable
  • Inventory
  • Prepaid Expenses
  • Other Current Assets

What are liabilities on a pro forma balance sheet? 

The most common liabilities on a balance sheet are:

Current Liabilities

  • Accounts payable
  • Taxes payable
  • Notes, short-term (due within 12 months) 
  • Current part, long-term debt
  • Other current liabilities

Long-term debt

  • Bank loans payable
  • Notes payable to stockholders
  • LESS: short-term portion
  • Other long term debt

How to fill out a pro forma balance sheet? 

To complete a balance sheet, you need to input all your current assets, liabilities, and owner's equity into a balance sheet template.

What does a pro forma balance sheet look like?

Below you will find an example of a pro forma balance sheet:

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The template itself is very thorough and covers everything I can think of that should be covered. The At a Glance feature is very nice and useful. Customer service is prompt and thorough and they are good at answering specific questions and modifying the template when needed. I highly recommend this as a tool for getting any restaurant project set for success.
Michael Sammons
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Hi Adam, You are an absolute legend. Thank you so much for that Loom video – it was super informative. I really appreciate you going out of your way to assist.
Ben McCarthy