Financial Statements are used to record and provide information on the financial activities of a business, person or entity, this information is used by a wide range of entities in order to make economic decisions (Reference). These reports quantify the financial strength, performance and liquidity of a company and are intended to be understandable to audiences who have an adequate knowledge of economics and accounting. To acquire a better knowledge of financial statements it is important to understand…

(2005) stated that “people perform financial analysis for different reasons, Supplier want to see if a customer can afford a price hike, Customers want to know if a company will still be around in a year to honor a warranty, Managers, creditors, investors, and the CEO’s all have their reasons for reading the statements, regardless of your interest in the company. Financial statement analysis involves using financial data to assess some aspect of a company’s performance” Horngren added ”Although many…

used in measuring a company 's pricing strategy and operating efficiency. Thus the operating margin. Measures your operating profitability, it indicates how much of each dollar of revenues used is left over after both costs of goods sold and operating expenses are considered. Operating margins are important because they measure efficiency. The higher the operating margin, the more profitable a company 's core business is. for example I Created a Mock report Called Dean 's Report I report the…

Financial Statements Firm owners as well as managers keep track of the company’s financial performance by maintaining at least four major financial statements. The major financial statements include Income statement, Balance sheet, stockholder’s equity statement, & cash flows statement. Each financial statement provides different type of activity of the company 's financial status in the particular period. Financial statements are usually prepared based on the company’s need it could be monthly,…

Tracking Company Performance with Financial Statements To determine the health of a company, the managers within the firm utilize financial tools. Financial statements help the management team determine the health of a company. These tools include the income statement, balance sheet and statement of cash flows. The data that these documents provide assist the owners in making key strategic decisions. Additionally, this data assists lenders as to the in the viability of their commitment to credit…

Introduction In an economic market place, business financial performance is essential to survival. Regardless of the organization’s composition and type, whether for-profit or not-for-profit, financial statements provide the necessary feedback concerning the firm’s performance. Although there are different types of financial statements, the basic and most common ones are the income statement, balance sheet, and statement of cash flows. The information provided on these formal records are of great…

The financial statements that a company produces can be used to help evaluate the financial condition of the company. The main statements are the income statement, the balance sheet and the statement of cash flows (Harper, 2012). The company's performance can be evaluated in a number of different ways. The most important are that the company can be evaluated against its own past performance, and it can also be evaluated against other firms in the same industry. The income statement for Dick's…

Final Exam Question 4 According to FASB webpage, revenue is a crucial number to users of financial statements in assessing a company’s performance and prospects. However, revenue recognition requirements in U.S. GAAP differ from those in IFRS, and both sets of requirements are considered to be in need of improvements. Accordingly, the FASB and the IASB initiated a joint project to clarify the principles for recognizing revenue and to develop a common revenue standard for U.S. GAAP and IFRS that…

Managers within a firm, including the owners and lenders, need to track the firm’s performance in order to be successful. Those individuals are able to review performance through analysis of the company’s financial statements. A firm’s financial statement consists of a firm’s income statement, balance sheet, and cash flow (In/Out). Businesses use these reports to understand the financial position of the firm. The reports can also serve as a tool when making decisions on how the firm will operate…

Amazon Financial Statements Introduction This paper relates to finance and accounting. The main objective is to assess and examine financial statement of the chosen company. Amazon Inc. was chosen as the target company. It is a retail giant with more than $350 billion of market capitalisation. The company is headquartered in Seattle, Washington. Its main business sector is internet retail. Since Amazon is the US company and its stocks are listed on Nasdaq, the company has to file regularly reports…