Financial Documents

A business needs to produce the following documents:

Profit and loss account

shows how well the business traded for a particular period of time

Balance sheet

a statement of the assets and liabilities of a business at a particular time,
how those assets and liabilities have been financed.

Cash flow statement

a statement showing how cash has come into the business and what it has
business has traded for a specific period been spent on.

Asset what the business owns

Two types:

Fixed assets assets that can be used repeatedly

Current asset an asset that can be quickly turned into cash

Liabilities what the business owes to others

Two types:-

Current liabilities that have to be repaid within 1 year

Long term liabilities that have to be repaid in more than one year