Statement of financial position (S.F.

P)
Statement of Financial Position was previously referred to as Balance Sheet. The SFP shows the
company’s assets, liabilities and equity.

Cost of sale

Beginning purchase plus inventory minus ending

Available sale

Net plus beginning

Net sale

Gross sale minus sale discount

Total goods available for sale

Inventory beginning plus purchase plus freight in

Gross sale income

Net sale minus cost of sale

Net income

Gross income minus general operating sales

Statement of comprehensive Income ( S.C.I )

Statement of Comprehensive Income is same as and previously referred as Income Statement, when
there is no Other Comprehensive Income presented such as; unrealized gains or loss on translation of
foreign operation, re-measurement gain or loss and etc., the difference of the two will be tackled in
higher accounting because of its complexity. The Statement of Comprehensive Income is the statement
that gives you the information regarding the income and expenses of the company that incurred for a
certain period of time. It is usually presented first in the Financial Statement, because you need to
determine the profit which has to be shown in the capital statement then the balance of capital account
is transferred in the Financial Position.

Gross sales

(Add all sales)

Net sales

Sales - sales discount-sales returns

Gross purchases

Purchases + freight in
Net purchase

Gross purchases- purchases return-purchases discount

Cost of sales

Beginning inventory + purchases- ending inventory

Total revenue

Net sales - cost of sales Net income Total expenses - total revenue

States changes of equity ( S.C.E )

Statement of Changes in Equity is also known as the Capital Statement.

SCE is the details of Equity account in the Balance Sheet. Accordingly, the balance of the Equity portion of the
Statement of Financial Position must have the same balance with the Statement of Changes in Equity. SCE shows
the movements of the capital account of the owners. Generally, SCE is composed of capital invested by the owners
and net income or net loss of the company.

Statement of cash flow (S.C.F)

The main purpose of the preparation of statement of cash flows is to highlight all the major activities
that directly and indirectly impact cash flows and hence affect the overall cash balance. A very good cash
management with sufficient cash balance at the right time, a company may acquire golden
opportunities.
Income statement
Total expenses
Salaries expense + utilities + rent + supplies
Direct cost of service
Direct labor + Direct materials
Net income or loss
Direct cost of service + total expense =(total) -service income