Financial Statements: A Step-by-Step Guide to Understanding and Creating Financial Reports

straightforward transaction example. And with the book's uniquely visual approach, you'll be able to see exactly how each transaction affects the three key financial statements of the enterprise. Each statement paints a different and essential picture--the "three-legged stool" of company reporting: * The income statement shows the manufacturing (or service offerings) and selling actions of the company that result in profit or loss during a period. It gives a very important perspective on the company's performance, its profitability. * The cash flow statement details cash into and out of the company for a period. You need money to make money. Running out of cash is bad. Duh. * The balance sheet records at the end of a period, an instant in time, what the company owns and what it owes, including the owners' stake, called shareholders' equity.