Financial Statements
Objective 15-3 Describe the three basic financial statements and show how they reflect the activity and financial condition of a business.
As noted previously, accountants summarize the results of a firm’s transactions and issue reports to help managers make informed decisions. Among the most important reports are financial statements, which fall into three broad categories: balance sheets, income statements, and statements of cash flows. Together, these reports indicate the firm’s financial health and what affected it. In this section, we discuss these three financial statements as well as the function of the budget as an internal financial statement.
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