Income Statement Benefits - Balance Sheet Benefits
Here we discuss about Income Statement Benefits - Balance
Sheet Benefits. Previously we discuss about Income Statement Example - Balance Sheet Example. If you do not read this article then kindly read this one
because without knowing this topic, you
can not better understand benefits of these kinds of Financial
Statements.Firstly we discuss benefits of Income Statement and then Balance Sheet.
For Income Statement
Ø The Company can check the financial performance or
net income of the business with this statement easily.
Ø If the company businesses are earning profit
shown in this statement, then the investors and big financial companies will
surely invest in the company businesses.
Ø True and Fair view of financial statements are
presented to user of financial statement.
Ø Any error in Trial Balance is corrected with Adjusting
Entries and hence accounts present in this statement give true and fair view to the external users.
For Balance Sheet
Ø We find Financial Position of the Business
through this statement.
Ø Users of Financial Statements are interested in
the Financial Position of the business and this information is obtained for
this statement.
Ø This statement tells us that how many Resources
(Assets) of Company Business have to meet Equity (External Liabilities and
Capital).
Ø Balance Sheet helps the company businesses in
balance because company must meet its short-term and long-term obligations out
of resources to enjoy long life.
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