About This Chapter
Financial Statement Basics -- Chapter Summary and Learning Objectives
A business's financial statement is a picture of their financial situation and activities for a given time period. This chapter will examine the parts of these documents and explain how to use them to determine the health of the business represented by the statement. The topics covered herein are:
- Control of cash flows
- Typical financial statements
- Preparation of financial statements
- Ratio analysis
|Control of Cash: Definition & Methods||Explain cash flows and the statement of cash flows.|
|What Are Financial Statements? - Definition, Purpose & Importance||Discuss different types of financial statements including balance sheets, income statements, and cash flows.|
|Preparing Financial Statements||Examine the preparation of financial statements.|
|Financial Statement Ratios: Determining Company Performance||Study different methods of ratio analysis used to determine company performance.|
|Liquidity Ratio: Definition, Calculation & Analysis||Discover the ability of a business to cover short term obligations out of available cash.|
1. Control of Cash: Definition & Methods
Cash is a valuable commodity and one that is vulnerable to fraudulent activity. In this lesson, you will learn what makes up a company's cash account as well as how to control cash.
2. What Are Financial Statements? - Definition, Purpose & Importance
Financial statements are big players in the world of accounting. In this lesson, you will be introduced to each of the financial statements. You will also learn what their role is in the accounting industry, who they are important to and why they are important.
3. Preparing Financial Statements
Financial statements are the most sought after reports in the financial industry. In this lesson, you will learn how to prepare them using information found on the adjusted trial balance.
4. Financial Statement Ratios: Determining Company Performance
Have you ever wondered why the financial statements are so important to a company? In this lesson, you will learn about several financial statement ratios and how they help determine company performance.
5. Liquidity Ratio: Definition, Calculation & Analysis
The financial stability of a company can be tested in many ways. One of the quickest ways to see just how well a company is performing is to use financial ratios. In this lesson, you will learn what liquidity ratios are, how to calculate them, and how to interpret them.
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Other chapters within the Finance 101: Principles of Finance course
- Introduction to Corporate Finance
- Financial Statements, Taxes & Cash Flow
- Long-Term Financial Planning & Growth
- Introduction to Valuation Methods
- Discounted Cash Flow Valuation
- Interest Rates & Bond Valuation
- Stock Valuation
- Net Present Value & Investment Basics
- Capital Investment Decisions
- Accounting Risk & Return
- Return, Risk, & the Security Market Line
- Options & Corporate Finance
- Cost of Capital
- Financial Leverage & Capital Structure
- Dividends & Dividend Policy
- Short-Term Financing & Planning
- Cash & Liquidity Management
- Credit & Inventory Management
- International Corporate Finance
- Studying for Finance 101