Financial Statements

Financial Statements Accounting is an training system that identifies records and communicates the economic events of an establishment to concerned users (Weygant, 2006, p. 4). For accountants to relay the entropy wanted by enkindle users, they must create hides that impart give the proper information of the composition. An accountant can create many reports, but just when four major reports that are created for internal and external users. Those reports bring the income disceptation, a maintained earnings command, a balance sheet, and a statement of cash flows. Each of these statements is interrelated, and an organization cant have one without the other. Income Statement The income statement is used to report the victor or profitability of the companys operations over a specific stoppage of time (Weygant, 2006, p. 22). For a retail store, an income statement lists revenues minus cost of goods sold to annoy crying(a) profit, then minus expenses to fo llow interlock income or gelt loss. Assets, liabilities and stockholders fair-mindedness are not a part of this statement because no income or loss is trusty in these items unless they have already been expensed. Assets depreciation leave wholly furnish up as an expense regularly, but the asset itself lead not unless it has been sold.

A liability will moreover head up once a payment has been make and it will be expensed out to the appropriate category. Because Stockholders equity is neer expensed out, it will never show up on the income statement. Stockholders equity is normally a dividend and will be considered either an make up or decrease in maintained earnings ( Weygant, 2006, p. 22). The income statemen! t is multipurpose to external users and internal users if they would want to know how gainful the organization is at a specific period in time. well-kept Earnings Statement The retained earnings statement reports the changes in retained earnings for a specific period of time (Weygant, 2006, p. 22). The retained earnings statement is...If you want to get a adept essay, order it on our website: OrderEssay.net

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