Financial Statements Essay

There are four introductory financial statements that companies use. They begin with income statement, statement of owners equity, counterweight sheet, and the statement of cash flows. Comp eachs use income statements to report how much money they have made and how much they have spent everyplace a specified period of time. The statement of owners equity is used to report whatever changes in equity from a companys net income or net loss, as thoroughly as report changes in the owners investments and withdrawals over a specified period of time. The balance sheet is used to report a companys financial position at any point in time.This statement includes knowledge such as what types of assets and their amounts, liabilities, and equity. The statement of cash flows is the last document out of the four basic financial statements. This statement is used to report how much money a company is bringing in (receipts), and how much they are spending (payments), during a specific period of time. any changes found in assets and liabilities on a balance sheet reflect the revenues and expenses found in the income statement, which in turn results in gains or losses for a company.The statement of cash flows reports more information concerning the cash assets that are listed on a balance sheet and a linked, but not necessarily the same, as the net income found on the companys income statement. Financial statements are nothing but meter on a document when theyre on their own, but together, they provide valuable and powerful information for a company to make very big decisions about how to run their company, and how to make decisions for their company in the future. The information is also valuable for investors to make wise and educated decisions for investing in companies.