More specifically, what are financial statements, financial literacy, and financial expertise?
Financial statements assign a value (in U.S. statements, a dollar value) to the wealth of a firm. There are three main types of financial statements: the balance sheet, the income statement, and the cash flow statement. The balance sheet, which depicts the company’s total wealth at a single point in time (the date of the balance sheet), shows assets (cash, inventory, equipment, and other items of value), liabilities (debt incurred by the firm), and equity (assets minus liabilities). The income statement, which depicts activity for a discrete period such as a financial quarter or year, shows revenues (sales recorded for the period), expenses (expenses incurred in the period), and earnings, also known as net income or profits (sales minus expenses). The cash flow statement shows cash that came in and went out during a specific period such as a financial quarter or year. The traditional, more descriptive name for this report was sources and uses of cash. The individual in charge of financ
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- More specifically, what are financial statements, financial literacy, and financial expertise?
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