Purpose of financial statements:

• What do financial statements summarize about a business?

  Financial performance and position
• What does the cash flow statement track?

  Movement of cash
• The income statement includes revenues, expenses, and profits
• Order the main types of financial statements:

  1️⃣ Income Statement

  2️⃣ Balance Sheet

  3️⃣ Cash Flow Statement
• The balance sheet includes assets, liabilities, and equity
• The income statement is also known as the profit and loss statement
• The income statement measures a business's profitability over a specific period
• What are assets in a balance sheet?

  Resources owned by the company
• Match the financial statement with its key information:

  Income Statement ↔️ Revenues, expenses, profits

  Balance Sheet ↔️ Assets, liabilities, equity

  Cash Flow Statement ↔️ Cash inflows and outflows
• What does the cash flow statement track about a business?

  Movement of cash
• The Balance Sheet shows assets, liabilities, and equity
• What does revenue represent in an income statement?

  Income from sales
• Match the balance sheet components with their descriptions:

  Assets ↔️ Resources owned by the company

  Liabilities ↔️ Amounts owed to creditors

  Equity ↔️ Ownership interest in the company
• The Cash Flow Statement includes operating, investing, and financing activities.


  True
• Match the stakeholder group with their primary information needs:

  Employees ↔️ Job security and growth

  Regulators ↔️ Compliance with standards

  Competitors ↔️ Benchmarking and trends
• The balance sheet shows a business's financial position at a specific point in time.


  True
• How many main types of financial statements are there?

  Three
• What does the cash flow statement track about a business?

  Cash inflows and outflows
• The balance sheet shows a business's assets, liabilities, and equity.


  True
• The balance sheet shows a business's assets, liabilities, and equity.


  True
• What are expenses in an income statement?

  Costs incurred to earn revenue
• The balance sheet adheres to the accounting equation: Assets = Liabilities + Equity.


  True
• What does equity represent in a balance sheet?

  Ownership interest in the company
• The balance sheet shows a business's financial position at a specific point in time
• What does the Income Statement measure?

  Profitability over a period
• The equity in the example is calculated as assets minus liabilities
• The income statement helps stakeholders assess financial performance
• The cash flow statement tracks the inflows and outflows of cash
• Lenders use financial statements to evaluate a company's creditworthiness and ability to repay loans
• The Balance Sheet shows a company's financial position over a period of time.

  False
• The income statement measures a business's profitability over a specific period
• Match the financial statement with its purpose:

  Income Statement ↔️ Measures profitability

  Balance Sheet ↔️ Shows financial position

  Cash Flow Statement ↔️ Tracks cash movement
• The balance sheet shows a company's financial position at a specific point in time.


  True
• What does the income statement measure about a business?

  Profitability over a period
• What does the income statement measure about a business?

  Profitability over a period
• What are revenues in an income statement?

  Income from sales
• What does the balance sheet summarize about a company?

  Assets, liabilities, and equity
• Liabilities in a balance sheet represent amounts owed to creditors
• What does the income statement measure about a business?

  Profitability over a period
• Revenues in an income statement represent income earned from sales of goods or services.


  True