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Financial Statements

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Title: Financial Statements

Essay Details:

Subject: Business

Author: Wendy W

Date: December 20, 2013

Level: University

Grade: A

Length: 4 / 1015

Essay text:

This report will explain the purpose of each report and identify the components of each. The first tool that I would like to discuss is the income statement. The main function of the income statement is to explain the profitability of an organization over a defined period. This period could be monthly, every three months, or the expected business cycle of one year (Block & Hirt, 2005). The income statement is a stair step approach that explains the profit or loss realized by a firm after each expense is deducted. The first section of the income statement will show operating profit. Operating profit is defined as gross profit (sales less cost) less such miscellaneous expenses such as selling costs, administrative costs, and depreciation costs (Block & Hirt, 2005)...

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