Tools For Managing A Company

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Tools to Remain Financially Healthy Owners and managers need to be able to effectively and efficiently identify how well the company is doing. One way of doing this is to utilize financial statements as well as various ways of conducting an analysis of this information. How money is spent, where it goes and what money is coming in is all valuable information that is not only important to the company. It also provides an overview of data that is used by potential investors and lending institutions as well. It tells them how healthy the company is. It shows profits and stability of an organization and having these statements and reports prepared lend to this viability. The data pulled from these statements can also provide insight that…show more content…
This expense can provide a good understanding of whether to management of the company is spending as efficiently as possible or whether they are wasting money. Additional expenses include Interest Expenses as well as other expenses (Income). These expenses are usually deducted from the companies operating income. (Melicher & Norton, 2015) Balance Sheets The balance sheet is considered a statement which represents the company’s financial position as of a specific date in which some call a snapshot of the company at a given time. (Melicher & Norton, 2015) It includes information on assets and liabilities. Assets may include current assets which include cash or any assets that can be converted within a year as well as fixed assets which include the physical facilities the company uses for production, storage, distribution or for the displaying of a company’s products. Liabilities on the other hand provide an idea of what is owed to the creditors and owners. This can include accounts payable, accrued liabilities that need to be met which come from current funds and operations. IT also includes notes payable. (Melicher & Norton, 2015) The Owners’ Equity Section The Corporate balance sheet will include three different types of accounts that comprise the owner’s equity which are preferred stock, common stock and the retained earnings account. The preferred stock on a corporate balance sheet is considered stock that provides
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