Business Administration & Management

Mr. Bernstein

Financial Statements, pp 409-415

May 22, 2013

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Business Administration & Management

Mr. Bernstein3 Primary Financial Statements

Income Statement

Ledger Balances

Cash Flow Statement

Balance Sheet

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Business Administration & Management

Mr. Bernstein

Accounting SystemsBusinesses keep score

GAAP: Generally Accepted Accounting PrinciplesThe Accounting Equation: Assets = Liabilities + Owner’s Equity

Assets are anything of value (ie cash, equipment, accounts receivable)

Liabilities are anything the business owesOwner’s Equity is the net worth of the business

(Assets – Liabilities = Owner’s Equity)

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Business Administration & Management

Mr. Bernstein

3 Primary Financial StatementsIncome Statement reports Profit/LossBalance Sheet reports Assets & LiabilitiesCash Flow Statement reports cash receipts and disbursements