A balance sheet is a snapshot of everything the business owns and everything it owes, at one point in time.
It answers a different question from the profit and loss. The profit and loss covers a period and asks whether you made money. The balance sheet covers a moment and asks what the business is actually worth.
What you own includes your cash balance, money owed to you, equipment and inventory. What you owe includes bills you owe, loans and credit lines. The difference between the two is the owner stake in the business.