Finaces Statements

In: Business and Management

Submitted By knaccar
Words 728
Pages 3
Finance Statements Paper
Kimberly Nelson
David Schwanke

Finance Statements Paper
When preparing financial statements for a company it is important to recognize the four basic financial statements and to understand the purpose of each statement and how it may affect internal and external users. This paper will cover each statement in sequential order and will discuss how the statements are useful to internal and external users.
Income Statement- The income statement lists the company's revenues followed by its expenses. The final numbers from this calculation will indicate net profit or loss. The success or failure of the company's operations for a period of time is derived from this calculation. Managers use the income statement as a means to determine if the companies’ operations are profitable. The income statement reports on the success or failure of the company’s operations by reporting its revenue and expenses. Adjustment to its operations may need to take place internally to continue profitability. Investors are interested in past net income because it provides useful information for predicting future net income. Creditors also use the income statement to predict future earnings.
Retained Earnings Statement- The retained earnings statement shows the net income retained in the corporation. The time period covering the retained earnings is the same time period of the income statement. That time period can be represented monthly, quarterly, semiannually, or annually. The beginning retained earnings amount appears on the first line of the statement which is derived from the Income Statement. Then the company adds net income and deducts dividends to determine the retained earnings at the end of the period. By monitoring the retained earnings statement, financial statement users can evaluate dividend payment practices. Some…...

Similar Documents

Tata Steel Finace Statement

...TATA STEEL 2009 FINANCIAL RATIO ANALYSIS ABHIJIT SAMANTA I N T E R N A T I O N A L S C H O O L O F B U S I N E S S & M E D I A ; K O L K A T A P a g e | 2 FINANCIAL RATIO ANALYSIS OF TATA STEEL 1. Liquidity Ratios:- Liquidity Ratios measures the ability of the firm to meet its short term obligations. They also reflect the firm’s ability to meet financial contingencies that might arise. (A) Current Ratio: - This ratio indicates the firm’s ability to meet its current liabilities. This ratio is of very high importance to the suppliers of short term funds like the bankers and trade creditors. It is measured by: - Current Ratio = Current Assets / Current Liabilities. As per Balance Sheet 31st March 2008 & 2009. (All figures are in crore.) Year Current Asset Current Liabilities Current Ratio 2008 3,613.70 3,855.26 0.94 2009 5,707.05 6,039.86 0.94 Analysis: - The industry norm value of current ratio is 2:1. However it does not mean so that higher current ratio means good company profile. It may signify higher unused cash, inventory which again may result in inventory carrying cost. In both the years the Current ratio for Tata Steel is same. However it does not mean any increase or decrease in current ratio of any company gives the growth profile of the company. P a g e | 3 (B) Quick Ratio:- ...

Words: 2161 - Pages: 9

Income Statements and Cashflow Statements

...In order to determine how income statements and statements of cash flows influence business decisions, it is important to know the definition of the two. Income Statements are defined as the summaries of an entity’s revenues, expenses, gains, and losses for a period of time and thereby reports the entity’s results of operations for that period of time. It determines if an entity operates at a profit during a certain time frame, and reports revenues, expenses, gains, and losses. The Statement of Cash Flows is a financial statement that explains the change of cash flows during a fiscal period. This includes operating cost, investments, and financial activities of an entity. Its purpose is to identify the sources and uses of cash throughout a fiscal period, and report all activities involving operations, investments, and financing. Both statements are very important in making long term and short term decisions in business. Income statements are important in determining these decisions because they allow investors to determine their role in an entity’s success by viewing its operating potential, management to determine decisions within the entity dealing with material costs, sales strategies, and consumer response to those changes, and CEO’s to view revenue reports, expenses of operating costs, and the gains and losses of the entity during a defined fiscal period before making major decisions on the direction of that entity. Statement of cash flow allows CEO’s, Investors, and......

Words: 360 - Pages: 2

Financial Statements statement. The financial statement lets the person and business know what debits have been taken place in a monthly and yearly time and also credits that have been done in a monthly ans yearly time. There are four types of a financial statement and that is a balance sheet, a profit and loss statement, a statement of a change in equity, and a statement of cash flow. These four types of a financial statement have their own purpose in the accounting field and they are all very important to the businesses and individual people that use each of them. The balance sheet lets the businesses and people that use this sheet know what assets, liabilities, and ownership equity at anytime they need it, monthly, quarterly, or yearly. The balance sheet is also a summary of a sole proprietorship, business partnership, and other business organizations, if companies and businesses need them depending on if there is an audit of the company or needing them for month end or yearly end purposes. A balance sheet usually has assets in one section of the statement and liabilities and net worth in the other section. There are two types of a balance sheet and that is an account form and a report form. The balance sheet for personal use has current assets such as cash flow whether is would be in the checking account and or in a savings account or liabilities such as mortgages, and other debits that go through the account. The profit and loss part of the financial statement is the......

Words: 1060 - Pages: 5

Nike Finace Analysis

... 4 Nike Business Information. Retrieved on April 19, 2013 from Using various financial websites such as Yahoo Finance, MSN Money, Daily Finance, and Nike, our group was able to obtain financial statements and trading information for NKE and its closest competitor, Titan Industries Ltd. We obtained financial statements from Nike to analyze the company’s quarterly trends using the last four most recent quarters of information and compared them to Titan, the largest company in the world for manufacturing textiles next to Nike. A SWOT –strength, weakness, opportunity, and threat analysis was prepared along with qualitative and quantitative data from the industry comparative analysis, to help investors, lenders, and readers understand the direction of the company. Section A. Computations Our team obtained income statements, balance sheets, cash flow statements and trading information for NKE for the four most recent quarters (30-May 2012, 30-Aug 2012, 29-Nov 2012 and 27-Feb 2012) from four internet sources, namely: • Yahoo! Finance5 • MSN Money6 • Money Control CNBC 7 • Nike8 Generally, we found that Yahoo! Finance and Nike had the most closely corresponding information. All data for the industry standard Titan, which trades under the symbol “TITAN.BO”,......

Words: 4245 - Pages: 17

Accounting Statements

...Accounting Statements Bethany Edings Acct/290 January 25, 2013 Doyle Jones University of Phoenix Accounting Statements In business finance there are four main statements. The financial statements are balance sheets, income, cash flow, and statement of retained earnings. Each statement shows specific information about a business’s financial history. A balance sheet shows a company its current debts and how much it has at any given time. Income statements illustration what was spent and how much of a profit the business made. A cash flow statement shows the relationship between a company and the world during a given date. Next a statement of retained earnings indications any changes that would affect stockholders over time. A balance sheet gives information about a company’s assets, liabilities, and shareholders’ equity. Balance sheets have three components. The components of a balance sheet are assets, liabilities, and stockholders’ equity. Assets are objects or property that has cash value. These items can be used or sold to make a product or to provide services. Cash and investments are also assets. Liabilities are what a company owns to other companies or people. This can include loans, taxes, rent, cost of materials, and payroll. Liabilities are also services or products due to a customer. Shareholders’ equity or capital is what a company would have if the liquidated assets and......

Words: 729 - Pages: 3

Statement him a ticket for the parking violation when I finish withdrawing the money, and half of the car’s body was out of the zone when the officer was giving the ticket, because saw me finish withdrawing and was about to leave with me before the officer came. and I really did not mean to violate the law, we should not park in the handicapped zone even for a second. However, it's the first time ever for him to do that, and he had always followed the law. I actually should pay this penalty if it really occurs, because all of his behaviors were for helping me. Words failed me to express how guilty I feel for, and I just beg you forgive him this only one time. Please give him a chance. Thank you so much for your time to read this statement. Sincerely,...

Words: 268 - Pages: 2

Income Statement vs Cashflow Statement

...Question #6 A. Briefly state how the Income Statement is different from the Cash Flow Statement. Give examples of decisions that can be made from the information provided by each of these statements? -The income statement shows how much revenue a company has earned over a period of time, which is usually for a year. The income statement also reports the costs and expenses associated with earning the revenue. At the bottom of the income statement it shows the net inome, which shows the actual earnings after expenses, taxes, etc are taken out. This can be a net profit or net loss, depending on how the company performed that year. The cash flow statement reports a company’s inflows and outflows of cash. The income statement tells whether or not the company made a profit and the statement of cash flows tells you whether the company generated cash. The statement of cash flows is the more important of the two because with negative cash flows it makes it nearly impossible to pay off your debt. It is possible to have a positive net income, with negative cash flows. -A manager can use the income statement to analyze how much revenue is being lost due to expenses. Expenses are necessary in every business, but there are ways to manage them to save money. It also allows management and investors to decide if the company wants to expand into different markets or create new products. If they see sales are consistently increasing year over year, then it may be a good time...

Words: 428 - Pages: 2

Rhonda Finace Exam Answers

...Marketing Plan for R&B Exotic Fruit and Salad Bar Proposed by: Rhonda Fairley Submitted to: Professor Elliot Masocha Date: October 19, 2013 Table of Contents Company Description--------------------------------------------------------------------------------------1 Strategic Focus and Plan-----------------------------------------------------------------------------------1 Mission/Vision Statements-----------------------------------------------------------------------1 Goals------------------------------------------------------------------------------------------------2 Core Competency and Sustainable Competitive Advantage--------------------------------2 Situation Analysis------------------------------------------------------------------------------------------3 SWOT analysis------------------------------------------------------------------------------------ Industry Analysis----------------------------------------------------------------------------------4 Competitor Analysis------------------------------------------------------------------------------4 Company Analysis--------------------------------------------------------------------------------5 Customer Analysis--------------------------------------------------------------------------------6 Market-Product Focus-------------------------------------------------------------------------------------6 Marketing and Product......

Words: 3582 - Pages: 15

Personal Finace

... How should the bank protect itself against that risk? (2-4 sentences. 1.0 points) 4. If you had a bank account, which two methods of completing transactions do you think you would use most frequently? Why? (2-4 sentences. 1.0 points) 5. In your Section_3 folder, navigate to and open the Example_Check_Register and Example_Bank_Statement, and then answer the questions below. a. According to the bank statement, how many checks were written from this account during the statement period? (0.5 points) b. There are two differences between the bank statement and the check register. Describe each of them. (2-4 sentences. 1.0 points) TIP: These are transactions that Jessie Robinson forgot to write down in the check register. c. Do you think it is best to keep track of finances using a check register, a bank statement, or both? Why? (2-4 sentences. 1.0 points) d. List at least two non-discretionary expenses listed on the bank statement or check register. (1-2 sentences. 1.0 points) e. List at least one discretionary expense listed on the bank statement or check register. (1-2 sentences. 0.5 points) f. Describe at least one challenge of keeping a check register. (1-2 sentences. 1.0 points)...

Words: 478 - Pages: 2


...* Question 1 2 out of 2 points | | | Which one of the following is not correct? | | | | | Selected Answer: | C. For debt issued at a discount: interest expense reported on the income statement equals cash interest payment less amortization of the discount. | Answers: | A. For debt issued at par: interest expense reported on the income statement equals the cash paid for interest. | | B. For bond repurchases, the gain or loss is the difference between the book value and the repurchase amount. | | C. For debt issued at a discount: interest expense reported on the income statement equals cash interest payment less amortization of the discount. | | D. For debt issued at a premium, interest expense reported on the income statement equals cash interest payment less amortization of the premium. | | E. None of the above | Response Feedback: | Rationale: For debt issued at a discount, interest expense reported on the income statement is cash interest paid plus amortization of the discount. | | | | | * Question 2 2 out of 2 points | | | Morse Corp. sells $200,000 of bonds to private investors. The bonds have a 9% coupon rate and interest is paid semiannually. The bonds were sold to yield 8%. What periodic interest payment does Morse make? | | | | | Selected Answer: | D. $ 9,000 | Answers: | A. $16,000 | | B. $ 8,000 | | C. $18,000 | | D. $ 9,000 | | E. None of the above | Response Feedback: | Rationale:......

Words: 1169 - Pages: 5

Personal Finace

...for your first month in the UK. • How do you decide which bank to open an account with ? Unless you have a preferred bank, you don't need to worry to much about which bank to choose. This is because all banks will normally offer you a basic current account to begin with. The basic current account will allow you free cash withdrawals from most ATMS, you will be able to opt in and out of receiving a printed bank statement and will be able to set up a direct debit. It would be helpful for you to opt to receive paper copies of your bank statements as you may need to use them for proof of address during your time in the UK. • What documents do you need in order to open an account? -your passport and valid visa to be in the UK, if you are an overseas student -your passport or national ID card if you are from the European Union -proof of address in the UK and in your home country TIPS: •if you are expecting to receive money from overseas ask about processing times and any charges that may apply •when opening an account opt for printed statements rather than online Keeping in touch London is one of the most well connected cities in the world and you will find it really easy to stay in touch with your family back home and with your new friends in the UK. Calling international numbers from the UK can be expensive, especially if you decide to use your mobile. Some good ways to save on international calls include: voice over internet protocol,......

Words: 1778 - Pages: 8


...obtain resources and assign them to deliver on given tasks – minimize costs and improve profits. * Decide on priorities, integrate resources and efficient technologies into the organization and account for the project’s external costs. * Manage the execution of work and continuously seek possible resource savings, without affecting quality. * Monitor the work done and resources used, compare with the project plan, estimate the resources required to complete on a high profits, come financial year end. * Through financial planning and strategy, calculate resources actually used and re-plan similar tasks based on the new figures for the current and new fiscal year. * Practice continuous improvement. 2. PROBLEM/DECISION STATEMENT It is a clear indication that radical change and transformation was required to resuscitate the organization into a learning organization striving towards continuous improvement. The recommendations which analyzed all the identified aspects accordingly, to lead the change and organizational development A SWOT analysis to be done to identify the problems and categorize to make sure that the organization is led towards profitability Strengths | Weakness | * Investment in packaging equipment * Use of state of art new packaging machinery * Ownership of a process was given to the person agreed by the appropriate management and employees as having the best ability, best on training, skills and experience * Internal......

Words: 1988 - Pages: 8

Healthcare Finace- You Decide Paper

...problematic coding patterns, and then fix them. It is essential that we shorten our accounts receivable cycle right away. When claims are rejected, the hospital has to rework them, correct them, and resend them. All this leads to an increase in the amount of time it takes for the hospital to be reimbursed for its services. Based on the information I got from IT, Med XL has the potential to offers customizable editing practices that ensures that claims are automatically checked against the rules that apply to specific payer contracts. The system will check for contract compliance monitoring, underpayment identification, and appeals generation. Measure of success would be: -When average collection’s number of days returns to 55. -Statement of Cash flows. An increasing trend in the net cash flows indicates better cash position that could be attributed to effective management of accounts receivables -Significant reduction in claim rejection. Reference Nowicki, Michael (2008). The Financial Management of Hospitals and Healthcare Organizations. Health Administration Press...

Words: 670 - Pages: 3


... ANALYSIS, FINDINGS and RECOMMENDATIONS 1.1 Company Profile Background of Dhaka Bank Limited (DBL): DBL is a scheduled bank that was incorporated under the Companies Act 1994, started its operation on July 1995 with a target to play a vital role on the socio-economic development of the country. Aiming at offering commercial banking service to the customers’ door around the country, DBL established 20 branches up-to this year. This organization achieved customers’ confidence immediately after its establishment. At the end of year 2007 the equity ownership of DBL was as follows: Ownership Structure Sponsors Institutional Investors General Public Foreign Chart 1.1: Ownership Structure Source: Dhaka Bank Annual Report 2007 (A) Mission Statement To be the premier financial institution in the country providing high quality products and services backed by latest technology and a team of highly motivated personnel to deliver excellence in Banking. An Evaluation of Business and Financial Performance of the Dhaka Bank Limited 1 January 2005 and 31 December 2007 Slogan Excellence in Banking Objectives • • • • • Be one of the best banks of Bangladesh. Achieve excellence in customer service next to none and superior to all competitors. Cater to all differentiated segments of Retail and Wholesale Customers. Be a high quality distributor of product and services. Use state-of the art technology in all spheres of banking. DBL is now offering different types Depository product for......

Words: 6510 - Pages: 27

Financial Statement

...Financial Statement Differentiation Paper Financial Statement Differentiation Paper ACC/561 The Four Financial Statements consist of income statement, balance sheet, statement of cash flow, and statement of owner’s equity. The progress with the income statement, states gross revenues, minus the goods sold would give the gross profit of the company. Balance sheet consists of long term assets and long term liabilities that are current issues. The cash flow would be recognized by the money the company has coming in, to where the money goes out, and the statement of owner equity gives details of the account over a period of time. Income Statement have a different description that contains expenses of Revenue during a time period, minus cost of goods sold, which would then give the gross profit. Once the net income would be figured out, the net income would be transferred over to the balance sheet. Balance sheet would consist of any assets and liabilities that are current and long term. The balance sheet has to make sure both ends balance out the same. Statement of cash flow gives the direction of company of where money is taken in from and to give ideas where the money is going to. This would consist of cash and payments. The statement of Owner Equity gives details that have taken place over course of one year of the owners’ equity account. The financial statement that would be of interest to investors would consist of income statement, balance......

Words: 445 - Pages: 2

Watch Movie | الشحن التعليمات | Paltan (2018) Hindi HDRip x264 AAC Bollywood Movie 720p [750MB]