Cashback Offer (20th - 30th September 2020). Get Flat 10% Cashback credited in your account on a minimum transaction of $80. Post Your Question

Question Details Normal
$ 5.00

ACC 290 Week 1 Individual Assignment Financial Statements Paper

  • From Business, Accounting
  • Due on 21 Aug, 2015 10:31:00
  • Asked On 21 Aug, 2015 02:32:47
  • Due date has already passed, but you can still post solutions.
Question posted by
Online Tutor Profile
request

Financial statements is a more common term used to refer to statements produced at the end of the accounting periods, such as the income statement, balance sheet, cash flow statement and the statement of owner’s equity. These four financial statements are sometimes known as the final accounts, which the business prepares.

The income statement also known as the trading and profit and loss account is a financial statement, which helps to calculate the gross profit and the net profit of the company for a particular year. Most of the businesses prepare the income statement because they compare revenues with expenses and check the performance. If the revenue exceeds the expenses, the business has earned a profit and vice versa. The information contained in the income statement is not only, but also useful for the internal users of the business such as the managers and owners but however it is also useful for the external users such as government, investors and creditors’.

For internal users, income statement helps to check the performance and profitability of the business. Owners invest their money merely to earn profits and thus it is necessary for them to check the amount of money they have earned in an accounting period. Similarly, manager’s status is directly linked with the profitability of the business. If the organization has able to achieve higher profits, manager’s salary and status often increases. Moreover, income statements also help to check the revenues and expenses of the business and thus managers can decrease their unnecessary expenses to earn more profits. In the same way, making of income statements is also useful for the external users such as investors, creditors and the government. Investors usually check the income statements of the organization to check the past financial performance of the business and to assess the capability of generating future cash flows. Moreover, creditors also take the help of the income statement to check whether the business has enough revenue to pay its dues on time. Finally, the government needs to check in order to calculate the taxes which the firm has to pay with respect to the profits earned over time.

The balance sheet is another financial statement which shows the assets, liabilities and the capital of the business. This document is prepared at the end of the accounting period, and it helps to check the liquidity position and the current health of the organization. It is based on an accounting model (e.g., assets = capital + liabilities). Internal users, such as managers and owners take the help of the balance sheet to check the liquidity of the business...

Available Answers
No solution has been posted yet.Be first to post the solution!
Other Related Questions
User Profile
Wilson
User Profile
Wilson
User Profile
Wilson
User Profile
Wilson
User Profile
Wilson

The benefits of buying study notes from CourseMerit

Assurance Of Timely Delivery
We value your patience, and to ensure you always receive your homework help within the promised time, our dedicated team of tutors begins their work as soon as the request arrives.
Best Price In The Market
All the services that are available on our page cost only a nominal amount of money. In fact, the prices are lower than the industry standards. You can always expect value for money from us.
Uninterrupted 24/7 Support
Our customer support wing remains online 24x7 to provide you seamless assistance. Also, when you post a query or a request here, you can expect an immediate response from our side.
closebutton
Only 45 characters allowed.
closebutton

$ 629.35