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The Difference Between Horizontal and Vertical Balance sheets is of presentation. In the horizontal balance sheet, the assets and liabilities are shown side by side but in the vertical balance sheet, the assets and liabilities are shown from top to bottom. The full meaning is explained in this article.
The whole presentation of both types of presentation is already explained in the following article: -
https://tutorstips.com/balance-sheet/
In this form of presentation of the balance sheet, we have to present all account information across the page from left to right. All assets are shown on the corresponding side of all liabilities. All liabilities are shown on the left side of the balance sheet and all assets are shown on the right side of the balance sheet.
There is also two way to sort the accounts of assets and liabilities, these are shown as following: -
In the vertical form of the presentation of the balance sheet, we have to present all account information across the page from top to bottom. First, we show all liabilities and capital and then after all assets. All assets are shown after all liabilities.
There is also two way to sort the accounts of assets and liabilities, these are shown as following: -
Basis of Difference |
Horizontal |
Vertical |
|---|---|---|
| Meaning | We have to present all account information across the page from left to right. | we have to present all account information across the page from top to bottom. |
| Base of Presentation | It is present side by side. | It is present from top to bottom. |
| Number of Sides | It has two sides | It has only a single side. |
| Sides shows | The left side shows Liabilities and the right side shows assets. | It has only a single side so firstly shown all liabilities(including capital) and then shown all assets. |
| Period Includes | It has included a single year data only i.e. Current year. | It has included two years of data i.e., the current year as well as the previous year. |
| Comparability | It is difficult to compare with the previous year because it includes only current year data. | It is easy to compare with the previous year because includes the data of the previous year as well. |
If you want to download the chart please download the following image and PDF file:-
Thus, both terms have the only main difference of presentation of the accounts of assets, liabilities, and capital. One is prepared side by side and another is prepared from top to bottom.
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Sarbjit Singh holds a B.Com and M.Com degree and has over 12 years of teaching experience in double entry bookkeeping, financial accounting, and business studies.
This guide covers "Difference between Horizontal and Vertical Balance sheet", focusing on key definitions, step-by-step concepts, applications, and revision guidelines relevant to Differences in financial accounting class 12.
It is primarily curated for Class 11 and Class 12 high school commerce, accounting, and economics students, as well as aspirants preparing for board exams or CA Foundation.
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