Financial Statement Paper Part I
Financial Statements Financial Statements of a company measures the performance of their accounting period. The four parts of a Financial Statement are income statement, balance sheet, and statement of cash flow, and stockholders’ equity. The income statement of Landry’s Restaurants will show the summary of how the business has incurred revenues and expenses through operating expenses (Phillip, Libby, Libby, 2005). The income statement of Landry’s Restaurants, Incorporation shows the profit or loss of the company during the specific accounting period. The consolidated statement of income shows the periods of three years. Over the year with the acquisitions that were done, in 2003 Landry’s Restaurants, Inc had a net profit of $45,901,054 and 11% increase from 2002 (Phillips et al., 2005). The income statement is important in Landry’s case because inventors will use the information to see whether the company is in a strong position for growth and how well they are financially (Albo, 2007). The statement of cash flow is used by a company when making a business decision. The cash flow shows the revenues the company is generating and the total expenses incurring during the specific accounting period. The balance sheet of Landry’s Restaurants, Inc shows an increase in 2003 from 2002. The increases are due to the small acquisitions in 2003 and 2002 consisted of acquisitions and redevelopments of existing restaurants (Phillips et al., 2005). Landry’s Restaurants showed in increase is total assets in 2003 of $1,102,785,506 from $933,015,079 in 2002, of which the cash and cash equivalents had an increase of $21,333,120. This shows a strong cash flow for the company (Phillips et al., 2005).
The balance sheet is important because it shows assets of which a company owns and the liabilities shows what a company owes along with the owner’s equity shows what the company is worth (Russell, n.d.).
In making business decisions, investors use the balance
References: Albo, B. (2007). What Is a Balance Sheet? FAQ-What balance sheets are, and why they are important to entrepreneurs. Retrieved August 16, 2010, from http://business- resources.suite101.com/article.crm.
Phillips, F., Libby, F., & Libby, P. (2005). Fundamentals of Financial Accounting: Landry’s Restaurants, Inc. 2003 Annual Report.
Russell, M. (n.d). The important of the balance sheet as a financial. Retrieved August 16, 2010, from http://ezinearticle.com.
U.S. Securities and Exchange Commission (2007). Beginners’ guide to financial statements. Retrieved August 16, 2010, from http://www.sec.gov/investor/pubs/begfinstmtguide.htm