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[PDF] Analysis of financial statement

   

Added on  2021-04-21

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Running head: FINANCE FinanceName of the StudentName of the UniversityAuthors NoteCourse ID

FINANCE2Table of ContentsAnswer to Task 1:......................................................................................................................3Answer to A:..............................................................................................................................3Answer to B:..............................................................................................................................3Answer to C:..............................................................................................................................3Answer to D:..............................................................................................................................4Answer to E:...............................................................................................................................4Answer to Task 2:......................................................................................................................5Answer to Task 3:......................................................................................................................5Answer A:..................................................................................................................................6Answer B:...................................................................................................................................6Answer C:...................................................................................................................................6Answer D:..................................................................................................................................6Answer E:...................................................................................................................................6Answer to Task 4:......................................................................................................................7Answer to Task 5:......................................................................................................................8Reference List:...........................................................................................................................9

FINANCE3Answer to Task 1: Answer to A:A balance sheet can be defined as the statement of financial position of a business thatprovides assets, liabilities and equities of owners during a particular point of time (Scott,2015). Alternatively, the balance sheet demonstrates the net worth of business. Thesesegments of balance provide the investors with the idea regarding what is owned and owedalong with the amount invested by the shareholders. The balance sheet is vital indemonstrating the financial health of the organization. Answer to B: The financial report comprises of the information on standard reports such as balancesheet, income or profit and loss statements and cash flow statement. They are regarded as oneof the most important components of business information and the principle mode ofcommunicating financial information regarding an organization external parties (Schaltegger& Burritt, 2017). The financial report comprises of information regarding earnings and itscomponents. Information regarding earnings from accrual accounting with the betterreflection of business current and future ability of generating positive cash flows.Answer to C: ProfitCash FlowProfit can be referred as revenue lessexpenses Cash flow is defined as cash inflow andoutflow from the businessProfit signifies the revenue from the sale ofgoods and services. Cash flow represents the difference betweenactual cash received and actual use of cashin the business process (Schipper et al.,2017).Profit is vital in understanding whether thecompany is generating sufficient income(Williams, 2014). Cash flow provides the actual measure ofassessing how the company is performing.

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