The document discusses key components of financial statements including the profit and loss account, balance sheet, income statement, and statement of cash flows. It explains that the profit and loss account shows operating profits broken down by sales, cost of sales, and expenses. The balance sheet reports assets, liabilities, and equity at a point in time. The income statement reports revenues, expenses, and net income over a period of time. The statement of cash flows reports changes in cash from operating, investing, and financing activities.
The document discusses key components of financial statements including the profit and loss account, balance sheet, income statement, and statement of cash flows. It explains that the profit and loss account shows operating profits broken down by sales, cost of sales, and expenses. The balance sheet reports assets, liabilities, and equity at a point in time. The income statement reports revenues, expenses, and net income over a period of time. The statement of cash flows reports changes in cash from operating, investing, and financing activities.
The document discusses key components of financial statements including the profit and loss account, balance sheet, income statement, and statement of cash flows. It explains that the profit and loss account shows operating profits broken down by sales, cost of sales, and expenses. The balance sheet reports assets, liabilities, and equity at a point in time. The income statement reports revenues, expenses, and net income over a period of time. The statement of cash flows reports changes in cash from operating, investing, and financing activities.
Whereas the balance sheet shows a Cost of Sales are expenses that can be directly attributed to sales items, such as snapshot at a point in time of the net worth purchases of stocks. of the business, the profit and loss account shows the current financial year’s net Expenses operating profits, broken down into various These are all other expenses (other than sales, cost of sales and expenses ledger purchases of assets) which cannot be attributed directly to sales items, such as rent, electricity or advertising. Sales Sales accounts show all sales made in the period, regardless of whether or not money has been received yet, and are shown as a credit in the Profit and Loss accounts. Where money has not yet been received, the debit is not to cash (as FINANCIAL STATEMENTS per the CD example above), but to a Debtors account (money Financial statements are general owed from customer account). purpose, external financial statements prepared according to generally Balance Sheet: reports the amounts of assets, liabilities, and accepted accounting principles. Some stockholders’ equity at a specified moment, such as midnight terms that apply to the financial of December 31; also known as the statement of financial statements include: position. Statement Of Cash Flows: reports the changes in cash and Income Statement: reports revenues, expenses, gains, cash equivalents during a period losses, and net income during the period of time stated in its of time according to three heading; also known as the statement of operations and as activities: operating, investing, the profit and loss (P&L) statement. and financing.
FINANCIAL STATEMENTS FINANCIAL STATEMENTS
Audited Financial Statements: Statement Of Stockholders’ Equity: reports the independent CPA firm gives changes in the components of stockholders’ equity, assurance about reasonableness including net income, other comprehensive income, and compliance with accounting dividends, exercise of stock options. principles.
Interim Financial Statements: issued between the Financial Reporting: includes
annual financial statements, e.g. quarterly financial statements, annual and quarterly reports to SEC and stockholders, press releases and other financial reports.