What are the Elements of Financial Statements?
A financial statement is not just designed for the business or entrepreneur. Shareholders, employees, management, bankers, suppliers, and other interested stakeholders will peep into the statements or demand the document on a regular basis in order to make crucial decisions. The statements will also be crucial for accurate tax returns preparation and other statutory filings. Several elements must be captured in the statement so that it can serve the intended purpose. Elements of Financial Statements Here are the 5 basic elements of any financial statements Assets :- These are resources owned and controlled by the business for which present or future benefits may flow to the business. When balancing the accounting equation, asset value will be the difference between equity and liabilities. Examples of assets include computers, land, cash, inventories, goodwill, prepaid expenses, and property, among others. Liabilities :- Liabilities are obligations that the business must...