Page 281 - DMGT104_FINANCIAL_ACCOUNTING

Unit 12: Corporate Financial Statements

12.6 Keywords Notes

Balance Sheet: The balance sheet is based on the equation: assets = liabilities + owners' equity.
Corporate Financial Statements: The corporate financial statements are the financial reports or
formal record of the financial and business activities of a firm.
Income Statement: The income statements are also called as the profit loss statements.
Statement of Cash Flow: The statement of cash flow gives information on the cash flow activities
of a company.
Statement of Retained Earnings: The statement of retained earnings describes the changes that
occur in the retained earnings of a company.

12.7 Review Questions

1. What is the Nature of Corporate Financial Statements?
2. Write down the Objective of Corporate Financial Statements.
3. Briefly explain the four basic types of corporate financial statements.

4. What are the Uses of Corporate Financial Statements?
5. Explain the Limitation of Corporate Financial Statements.

Answers: Self Assessment

1. Statement of Operations 2. income statement
3. changes 4. balance sheet
5. investment 6. True

7. False 8. True
9. inflationary 10. preliminary/pre-incorporation

12.8 Further Readings

Books Khan and Jain, “Management Accounting”.
M.P. Pandikumar, “Accounting & Finance for Managers”, Excel Books, New Delhi.
R.L. Gupta and Radhaswamy, “Advanced Accountancy”.

S.N. Maheswari, “Management Accounting”.
V.K. Goyal, “Financial Accounting”, Excel Books, New Delhi.

Online links http://www.globusz.com/

www.scribd.com
www.futureaccountant.com

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