Financial Loss Profit Statement

Financial Loss Profit Statement

Financial Loss Profit Statement

For a small business there are three basic financial statements. There’s the income statement, which reports the profit or loss for the company. There’s also the statement of cash flow that analyzes the business' ability to generate ready money. The final statement is the balance sheet. The balance sheet shows the assets, liabilities and owner’s equity at a specific point in time, usually month and fiscal year end.

How to Read a Balance Sheet

The main function of the balance sheet for a small business is to report owner’s equity. It can also be listed as net worth or stockholders shares for a corporation. The actual balance sheet is made up of three basic sections

  • Assets
  • Liabilities
  • Owner’s equity

Besides reporting owner’s equity, the report also displays the monetary value of assets as well as the business debts or liabilities.