What Are The Four Primary Financial Statements
413 Words2 Pages
There are four primary financial statements used accurately assess the performance of a business. These statements are the Balance Sheet, the Income Statement, the Statement of Retained Earnings and the Statement of Cash Flow. Theses statements can show areas that need improvement, show opportunity for growth as well as areas that are profitable and succeeding (Bethel University, 2011).
Question Two
Each financial statement will contain different aspects relating to the financial stability of the business. All four statements have a heading that consist of the business name, the title of the statement, the date of the statement, and then unit of measurement. The Balance Sheet is a representation of the business for a specific
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Consequently, after reviewing week one reading, I learned that there are four main financial statements. They are balance sheets, income statements, cash flow statements, and statements of shareholders’ equity (Bethel University, 2017). The balance sheets show what a company actually owns and what it really owes at a certain point in time. Income statements show how much money a company has made and spent over a matter of time. A cash flow statement explains the give-and-take of money between a company and the outside world also over periods of time.
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Cash Flow Statement: It is well known concept of money which says that it takes money to make money. The essence of cash flow is up for grasp. The company spends money is cash outflow and the company earns money is cash inflow. The income statement is the easy and well method to judge the performance of the company. In an article of 1995 Jonathan Moreland provides a very succinct assessment that indicated of the difference between the cash flow and earnings.
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