Financial Statements Exercise

Melissa Eaves

11/27/2012

XACC/280

There were two readings this week. One of them was about financial statements and one was about income statements. Here are two facts that I learned with each reading:

Financial Statements

The retained earnings section is not only listed on the Retained Earnings Statement but it is also listed under the Stockholder’s Equity part of a balance sheet.

A balance sheet is also known as a “statement of financial position/condition”, and an income statement is also known as a “statement of operations.”

Income Statements

There are two types of income statements that can be prepared. One is a single-step and one is a multistep. With a single-step statement, you include the revenues, expenses, and net income. With a multistep statement it separates the operating activities from the non-operating activities and allows instant comparisons and ratio computations.

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