Three basic financial statements

Although you don't need to be an accountant to be a small business owner, your business will have a much better chance to survive and thrive in this challenging business world if you have the basic accounting skills to analyze your business results. If you are unable to interpret your financial information, you will have no idea what is working and what is not. As a small business owner, at least, you should have knowledge of the three basic financial statements: Balance Sheet, Income Statement (Profit and Loss Statement), and Cash Flow Statement. The balance sheet represents a snapshot of your business' assets, liabilities, and shareholders' equity at a specific point in time. It gives you an idea as to what the business owns and owes, as well as the amount invested by the owners. The income statement (Profit…
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