Individual Financial Statements Paper
ACC/290 Principles of Accounting
Professor: Bruce Geddus
January 8, 2014
Introduction to financial accounting and it's my turn to identify the four basic financial statements and to describe them as well. In this financial statement paper I will also be describing the four financial statements, discuss how the four financial statements are useful to internal users such as managers and employees. And last I will discuss how the financial statements are very useful and important to external users such as investors and creditors. Financial statements are the primary means of communicating the financial information of an organization to the external users. The four general-purpose financial statements are the income statement, statement of retained earnings, statement of cash flow, and the balance sheet. It is very important that when doing a financial statement that you make sure all your numbers and up or just one mistake can mess up everything.
Now to describe the purpose of each of the four pieces of the financial statement I will start with the balance sheet. The balance sheet is the statement that lists the assets of a business and the corresponding claims such as liabilities and equity on those assets. I feel that the balance is pretty much a outline or overview of everything going on in the organization. The second part of the financial statement would be the income statement. The income statement is the statement that measures the difference between asset increases and the asset decreases associated with the running a business, and without this piece of the puzzle you wouldn't know how much you have or how much you're losing. On to the third part of the financial statement would be the statement of cash flow. The statement of cash flow explains how a business obtained and used cash during an accounting period. And on to the forth and final part of the financial...
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