Financial Statements

mo sack upary Statements Paper Jennifer Meadows ACC/290 Principles of Accounting I October 17, 2011 Financial Statements Financial logical arguments provide knowledge habitd to secure important decisions by both versed and external users. The cardinal basic fiscal statements apply by versed and external users ar the income statement, the well-kept earnings statement, the equalizer sheet, and the statement of cash flows. These financial statements are tied to to each(prenominal) one other and if one is incorrect, the schooling on the other statements quit be incorrect. The topic of handling in this paper allow for be to describe the four financial statements and determine how internal and external users use each of these statements. Income Statements Income statements report revenues minus expenses for a net income or paper bag of the makeup. Owners, managers, and employees measure the organizations success or failure by reviewing the income statement. potential drop investors can use gone and present income statements to predict time to come income or loss. Investors call for to make sure that an organization allow be profit fitted forwards investing money into an organization.

If the then(prenominal) and present income statements show loss or very weeny net income investors may solve the organization is not deserving investing in. Creditors leave alone use the income statement more than like potential investors would. Creditors want to condition that if they extend doctrine to an organization, the organization will be able to pa y screening the money in a middling amount! of time. The net income or loss reported on the income statement is used on the retained earnings statement (Kimmel, Weygandt, & Kieso, 2011). Retained pelf Statement The retained earnings of an organization will see on the net income or loss of an organization. If an organization reports a loss on the income statement there will be no earnings for the organization to retain. If the income statement reports a net...If you want to get a full essay, order it on our website: BestEssayCheap.com

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