Financial Statements Gail Howell ACC/290 May 20, 2013 Nnamdi Onuarah
A financial statement is a summary report that a company use to show stockholders, shareholders and lenders how the funds are used and the company’s current financial position. A financial statement shows the debits and credits. The four basic financial statements are broken into four categories, the balance sheet, the income statement, retained earnings statement that is also called owner’s equity and the statement of cash flow.
The balance sheet or balance statement is a statement that reports business assets, capital and liabilities at a specific point in time. The company’s asset and liabilities are described by the balance sheet are divided into near long obligations. Investors use the balance sheet to get an idea of the money the shareholders invested and what the company owns and owes
The income statement is a statement that a company or organization use that reports revenues and expenses that result from net or net losses at a specific time, the fiscal quarter or year. The summary of financial performance of a company’s revenue and expenses from operating and non-operating. The income statement has two parts, operating and non-operating. Operating directly shows how the company’s operation generated revenue and expenses. For example, the revenue and expense of the production of the equipment. Non-operating revenue and expenses are not directly tied to the company’s operation. For example if the company sold a plant or plant equipment.
Statement of cash flow is a...
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