Financial Statements Balance Sheet And Income Statement

Green as at 31 march 2015 in both horizontal and vertical style.

Financial statements balance sheet and income statement. The balance sheet shows a company s total value while the income statement shows whether a company is generating a profit or a loss. In financial accounting the balance sheet and income statement are the two most important types of financial statements others being cash flow statement and the statement of retained earnings. In the absence of information about the date of repayment of a liability then it may be assumed. The income statement and balance sheet report different financial accounting information about your business.

Preparation of balance sheet horizontal and vertical style. It lists only the income and expense accounts and their balances. Some consider the statement of stockholders equity also. I balance sheet it is a statement which shows the assets liabilities and equity of the company as described above ii income statement it is also known as profit loss account shows the profit earned or loss suffered by the concern in a particular period iii cash flow statement it is a statement that represents the inflow and outflow of cash during a particular period.

As of a certain date. The income statement totals the debits and credits to determine net income before taxes. The income statement reports revenue expenses and profit or loss while the balance sheet reports assets liabilities and shareholder equity. The income statement or profit and loss report is the easiest to understand.

The balance sheet reports a company s assets liabilities and stockholders equity as of a moment in time. However the balance sheet and income statement hold particular importance. There are three basic types of financial statements viz. Three financial documents can evaluate the health of a business.

The financial statement consists of three major segments. Each measures and reports on different aspects of a company s financial condition. The key differences between the two reports include. Let s understand each form of financial statement in brief.

The following trial balance is prepared after preparation of income statement for f. Income statement and balance sheet overview. A balance sheet lists assets and liabilities of the organization as of a specific moment in time i e. The income statement can be run at any time during the fiscal year to show a company s profitability.

Green as at 31 march 2015. An income statement also called a profit and loss account or p l. Prepare balance sheet for f. The balance sheet the income statement and the cash flow statement.

The balance sheet is one of the four main financial statements of a business.