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Acc 5561 Aspects of business - Statement of Cash Flows, Income Statement, Retained Earnings Stateme

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Acc 5561 Aspects of business - Statement of Cash Flows,
Income Statement, Retained Earnings Statement,Balance sheet
Week 1 Assignment
ACC/561-Accounting
When it comes to documenting financial statements, it is vital that they
are clear, based on specific data, and can be used for the decision
making process to be effective. In this case, there are four financial
statements that will be reviewed; the balance sheet, the statement of
cash flows, the income statement, and the retained earnings. These four
all prove to be important in different aspects of business as it relates to
“the numbers” game. The questions that are to be addressed in this
paper is which of these statements will appeal to the likes of creditors,
interested investors, and management.
Income Statement
The income statement takes into account the expenses and revenue.
The income statement is also known as the profit loss statement is
exactly what it says. The records from these numbers can be linked to
how successful a company has been. The use of the income statement
is to reveal to investors and management the monetary gains and losses
in a certain window of time. This proves the saying that “Time Is Money”
to be somewhat of the essence. When expense comes into play, the
focus is profit. According to "Investopedia" (2011) “A company’s expense
is the costs “economically” that it assumes through the process of trying
to gain revenue.” The key is to minimize or reduce expenses without
relying on revenues which in turn will yield positive profits. This would be
a good focal point that would peak the interest of investors because their
main goal is to make smart investments that will yield a positive profit.
Creditors could look the income statement to see if it would benefit them
to lend to the company. Managers would benefit from the income
statement because it would allow them to see where they stand as far as
making changes in order to increase profits. They can pin point the

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