Financial Statement

Essay by stickkUniversity, Bachelor'sA, July 2009

download word file, 3 pages 1.0

StickkAbstractFinancial statements are important to a business. A financial statement are used, by company's that the company can know all the financial earnings and expenses. Financial statement is interrelated and is used by managers, investors, creditors, and employees.

Financial StatementThe financial statement is broken down into four groups, which are the income statement, retained earnings statement, balance sheet, and the statement of cash flow. The financial statement allows business to see a breakdown of what is going on financially with that business. At my job, our corporate office uses two financial statements which are split into two separate divisions that illustrate each divisions profit and expenses. Quarterly financial statements are only done through corporate office while each office is required to do it each month. By doing a financial statement each month this allows each manager of his or office to see what adjustments are needed. Aon employees are given a goal that needs to be reach and if employees do not reach our goals then the company cuts our office expenses, which are coffee, breakfast on Fridays.

Financial statements are used management, stockholders and interrelatedIncome StatementIncome statement presents the revenues and expenses and resulting net income or net loss of a company for a specific period of time. Income statements are also referred to as the statement of operations, earnings statement and profit and loss statement.

Retained EarningsRetained earnings statement summarizes the changes in retained earnings for a specific period of time. Retained earnings allows business a way of keeping track of their revenues, expenses, dividends. If a business does not know what is going on with their retained earnings might not be a good idea for a company.

Balance SheetBalance sheet reports the assets, liabilities, and stockholders' equity of a business enterprise at a specific date. Assets are...