The three major Accounting Services Jersey City statements, often called financial statements, provide a comprehensive view of a company's financial health, performance, and cash flow. They are:

1. Balance Sheet (Statement of Financial Position)

The Balance Sheet is a snapshot of a company's assets, liabilities, and equity at a specific point in time (e.g., December 31st). It adheres to the fundamental accounting equation:

Assets are what the company owns (e.g., cash, accounts receivable, equipment).

Liabilities are what the company owes to outside parties (e.g., accounts payable, loans).

Owner's Equity (or Shareholders' Equity) is the residual interest in the assets after deducting liabilities; it represents the owners' stake.

2. Income Statement (Profit and Loss/P&L Statement)

The Income Statement reports a company's financial performance over a specific period (e.g., a quarter or a year). Its primary purpose is to show how much profit (or loss) the company generated. It follows this basic structure:

Revenue (or Sales) is the income generated from normal business activities.

Expenses are the costs incurred to generate that revenue (e.g., Cost of Goods Sold, salaries, rent).

Net Income (or Profit) is the "bottom line"—what's left over after all expenses are deducted from revenue.

3. Statement of Cash Flows (Cash Flow Statement)

The Statement of Cash Flows tracks the movement of cash and cash equivalents both into and out of the business over a specific period. Bookkeeping Services in Jersey City, which can include non-cash items (like depreciation), the Cash Flow Statement focuses strictly on actual cash transactions. It is broken down into three main activities:

Operating Activities: Cash flows generated from the company's normal day-to-day business operations (e.g., cash from sales, cash paid to suppliers).

Investing Activities: Cash flows related to the purchase or sale of long-term assets (e.g., buying or selling property, plant, and equipment).

Financing Activities: Cash flows involving debt, equity, and dividends (e.g., issuing stock, borrowing money, paying dividends).

Understanding these three statements is crucial for anyone—from investors to managers—seeking to evaluate a company's past performance, current condition, and future viability.

Balance sheet, income statement and statement of cash flow are the three major accounting statement and these three reports help you to measure the profit and loss of the business.

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