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Balance sheet

Total assets

Everything the company owns: cash, inventory, property, plant, equipment, goodwill, and other.

Total assets is the top half of the balance sheet, the sum of everything the company controls. The bottom half, liabilities plus equity, shows how those assets were paid for.

Growing assets is not automatically a good thing. The real question is whether those assets earn a high return, a measure called return on assets, or ROA. A business that doubles its assets but barely grows its earnings is destroying value, not creating it.

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