James Palmer
July 16, 2012
University of Phoenix
ACC/290
Lee Guillory, Faculty
Financial Statements Paper
One of the offset steps in the creation of a financial instruction system is to create financial narratives. Financial statements come in four basic forms: poise sheets, income statements, statement of retained earnings, and statement of interchange inclines.
A sleep sheet is used to get across the financial position of an history entity at a contingent point. A balance sheet shows the liabilities, assets, and the capital of the business. A balance sheet is usually prepared at the end of an accounting period. Internally, a balance sheet helps a business sum its liquidity position and the current health of the business. With the use of a balance sheet managers can check the liquidity of an organization. A balance sheet also helps in the management of assets and liabilities to account working capital needed for an accounting period. A balance sheet can also help keep star of inventory levels, including accounts payable and receivables, allowing management to adjust inventory levels.
Externally, the familys creditors and investors can also check a confederations balance sheet to assess risk. If a troupe has high liquidity an investor is more likely to invest in the company (SEC, 2012).
According to Investopedia a statement of money flow is a document that provides aggregate data regarding all immediate payment inflows a company receives from both its ongoing operations and away investment sources, as well as all cash outflows that pay for business activities and investments during a given quarter (Investopedia, 2012, p. 1). Internally, a cash flow statement helps an organization check its inflows and outflows of cash; from this the company can see if they have a famine or surplus of cash. A cash flow statement will also help a company survey its...If you want to get a full essay, order it on our website: Orderessay
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