ACCOUNTING BUSINESS FINANCIAL STATEMENTS

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ACCOUNTING BUSINESS FINANCIAL STATEMENTS

The financial reports are the formal books of the financial activities of a business. It gives an overview of the profits and financial status of the concern. Basically there are 4 types of financial statements. Income statements are the reports of the status of the revenue as well as the expenditures occurred, during certain period of time, in a business. This statement is meant for the purpose of showing the loss or gain, during a period of time, to the investors and the finance managers. It is the basic measurement of profitability of an organization.
Balance Sheet is the statement of assets and liabilities of an organization. It is the only record prepared at a point of time other than duration. It is the book value of the capital and expenditure of the business. It differs from the state of income and expense of a concern. Statement of retained earnings is known to be the proprietor equity statement and the finance net assets statement for a non- profit business.
Cash flow statements are the statement of activities of cash of a business. It includes the investment, operation and the finance financial activities. It shows the inflow and the finance outflow of cash of any organization. This statement is very useful for the business having limited assets in the form of cash. Hence all of these go together in making an interesting subject of accounting business finance which is the backbone of any business function.