Overview of Accounting

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Leo C


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December 22, 2010







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Contrastingly, financial reports of private businesses are only sent to owners and lenders of that business. So what are the differences between the different types of financial statements: (1) balance sheets; (2) income statements; (3) cash flow statements; and (4) statements of shareholder’s equity? Does a “balance sheet” show how a company balances out its monies? Do income statements tell us about every penny earned? Is the flow of money in and out of the business explained in a cash flow statement? Finally, how much is the shareholder’s equity truly worth? Balance sheets provide detailed information about s company’s assets, liabilities, and shareholder’s equity...
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An asset is anything that a company owns that have worth-physical property, trademarks, patents, cash, and investments are examples. Any money that a company owes is considered a liability such as rent, loans, money owed to suppliers, payroll, or taxes. Capital or net worth is shareholder equity and is the money left over after all assets are sold and debts are settled...
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