Financial Statements Part I

Essay by NorsfamUniversity, Bachelor'sA, November 2014

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Financial Statements Part I

Heidi Nors

ACC/427 Advanced Topics in Accounting Research

September 22, 2014

Lori Funden





Financial Statements Part I

Financial statements tell the story about a company, one that reveals the way the company is operated, if current procedures are working, future projections, and if there is any issues within the company. Each financial statement has a purpose and is used in it own unique way as an analysis and projections for any third party, such as investors, banks, and management respectively. Home Depot financial were presented to do an analysis of their earnings and potential profit margin for the coming years. Analysis of these statements are presented below with emphasis on areas such as revenues and retained earnings..

Consolidated Statements of Earnings

Consolidated Statement of Earnings, also known as the Income Statement, reflects the company's sales, cost of goods sold and other income that results in the net income, both operating and non-operating expense for a given period.

The bottom line shows how the company is running, any retained earnings shows a positive operation, yet any loss means can be pinpointed to a specific year by using a consolidated income statement. Comparing from one period to the next will show any misuse of revenues or excess spending.

The Consolidated Statement of Earnings is important to any translator of the statements due to the fact that one cannot hide when a company is in financial trouble. The comparison from one period to the next will offer any financial pattern in the life of the company. For example, if one year the company's revenues are up and expense are down, the opposite may be reflected in the next year as the company rebuild stock from an amazing...