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ACC 220 financial_statements

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Financial Statements 1
Running head: FINANCIAL STATEMENTS
Financial Statements
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Financial Statements
A business without an accounting department might just as well give up the rat race.
Accounting deals with very delicate matters pertaining to the company’s finances and without
that a company could go under. Some of the accounting department’s responsibilities are the
income statements, retained earnings statements and cash flow statements or a larger overview of
these entire sub sections tied into one would be the financial statement. This paper will go over
all of these areas of accounting in the hopes to broaden ones knowledge of accounting.
The financial statements of companies cover all their costs, losses and gains over a period
of time. Companies often follow what is called a fiscal year (FY) which is different than a
regular calendar year and every three months represent a quarter in their FY. For a company to
fully understand how they are doing and what kind of trend they are following they tend to use
what is called a comparative statement. This statement covers different time lines and compares
their statements from the past to the statements from the present. By doing this a company can
pinpoint areas that need help and areas that are breaking ground and making them money.
The first step we will take in this vast world of accounting deals with the income
statements that companies use and why they use them. An income statement is simply a
statement that reports the company’s financial performance over a specific time period. This
statement is split into two sections, the operating and non-operating sections. The operating
section deals with the company’s revenue and expenses that are a direct result of their regular
business operation. The non-operation part deals with the areas that are not a regular part of the
business, such as selling old equipment of leasing an old building that is no longer in use by the
company.

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Running head: FINANCIAL STATEMENTS Financial Statements Student Name College Name Financial Statements A business without an accounting department might just as well give up the rat race. Accounting deals with very delicate matters pertaining to the company's finances and without that a company could go under. Some of the accounting department's responsibilities are the income statements, retained earnings statements and cash flow statements or a larger overview of these entire sub sections tied into one would be the financial statement. This paper will go over all of these areas of accounting in the hopes to broaden ones knowledge of accounting. The financial statements of companies cover all their costs, losses and gains over a period of time. Companies often follow what is called a fiscal year (FY) which is different than a regular calendar year and every three months represent a quarter in their FY. For a company to fully understand how they are doing and what kind of trend they are following they tend to use what is called a comparative statement. This statement covers different time lines and compares their statements from the past to the statements from the pre ...
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