A balance sheet is a financial statement that reports the assets, which are resources owned by a business, liabilities, and stockholders’ equity at a specific date. Examples of assets would be computers, delivery trucks, furniture, and buildings.
A balance sheet has two categories: Assets, liabilities, and stockholders’ equity. Liabilities are the debts and obligations of a business. Liabilities represent c claims of creditors on the assets of business. Examples of liabilities would be notes payable, salaries payable, and interest payable. Stockholders’ equity is the stockholders’ claim on total assets. Stockholders’ equity contains common stock, results when the company sells news shares and retained earnings are the net income retained in the corporation.
A balance sheet is exactly what it is, a balance between the assets, liabilities, and stockholders’ equity. The basic accounting equation is Assets = Liabilities plus Stockholders’ Equity.
An income statement is a report that reports success or failure of the company’s operations for a period of time. The income statement lists the company revenues followed by its expense. The net income (or net loss) is determined by deducting expenses from revenue.
Retained earnings statement is a report that shows the amounts and causes of changes in retained earnings during the period. The beginning retained earnings amount is shown on the first line of the statement. Then net income is added
A statement of cash flow is a report that provides financial information about the cash receipts and cash payments of a business for a specific period of time. The statement of cash flows reports the cash effects of a company’s: (1) operating activities, (2) investing activities, and (3) financing activities. The statement also shows the net increase or decrease in cash during the period and the amount of cash at the end of the period.
The balance sheet, income statement, retained earnings, and the statement of...
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