Financial Statement Differences

Financial Statement Differentiation
ACC 561
July 30, 2012
Myrtle Clark

Financial Statements
Accounting has iv different types of monetary statements which provide important insights into the quick. These financial statements non only help to structure thinking about crease ratiocinations but also help to make right decision by providing valuable information. Common size financial statements provide percentage breakdowns of the income statement and balance sheet that allow easier compare across companies (Kimmel,2009, p.70).
Balance Sheet
Balance sheets summarize assets, liabilities and shareholders equity of any firm at a particular proposition point in time. These segments provide a clear show of any company, what it owns, owes, and the add up invested by the shareholders. Following formula is utilise for a balance sheet: Total assets = Liabilities + Stockholders equity. If any firm has total assets of $1,000,000 and total liabilities of $750,000, hence the stay amount of share holders will be the difference of assets and liabilities. This amount per given formula will be $250,000. This is a simpleton formula, which is used to calculate all assets of one company by summing up the liabilities and stockholders equity. This gives a quick financial picture of a firm.




Income Statement
The income statement reports the revenues, expenses, and profit (or loss) for a firm over a specific interval of time, typically a year o a quarter of a year. force out income is the difference between total revenue and total address during the period (Kimmel,2009, p.47). Lets take an example of a grocery store, which has fixed and variable expenses and if revenue of all sources exceeds expenses, then the grocery store will be profitable. On the different hand any firm will incur losses if expenses are greater than revenue. Net Income = Revenue Expenses
Statement of cash in Flows
Statement of cash flows indicates how cash position of the firm has changed during the period...If you demand to get a full essay, order it on our website: Orderessay



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