The balance sheet displays the company’s total assets and how the assets are financed, either through either debt or equity. It can also be referred to as a statement of net worth or a statement of financial position. The balance sheet is based on the fundamental equation: Assets = Liabilities + Equity. The assets and […]
Profit and Loss Profit and loss are two of the most important concepts in business. They tell you how much money your business is making and how much money it is spending. Profit and loss are also important for tax purposes. Profit and loss are calculated as the difference between revenue (the money your […]
Cash flow diagrams are visual representations of revenue and spending over a period of time. A horizontal line with markers at various time intervals forms the basis of the diagram. Expenses and expenditures are displayed at the proper moments. The circulation of money in and out of a business is referred to as cash flow. […]