Businesses hire external auditors to examine their business records and assess the fairness of their financial statements through the issuance of an auditor’s independent opinion or report. Audited Financial Statements are usually used by regulatory government agencies where the … [Read more...]
Sample Balance Sheet and Income Statement
The following are sample balance sheet (statement of financial position), income statement, and statement of changes in owner’s equity for an individual or sole proprietorship business. These sample financial statements are actually the ones we have discussed and prepared in our … [Read more...]
How to Make a Statement of Changes in Owner’s Equity
The statement of changes in owner’s equity is a separate component of financial statements for a sole or single proprietorship business. It presents how the capital shown in the balance sheet equity section changes over a period of time. It also shows the effects on the capital … [Read more...]
How to Prepare an Income Statement
If you own a business or providing professional services, you need to know if you are making profit or incurring loss. You need to take a look if your business is generating more revenues than your total expenses. This financial information is found on the income statement. The … [Read more...]
How to Prepare a Balance Sheet (Statement of Financial Position)
The balance sheet or the statement of financial position is one of the major components of financial statements, which include the income statement, statement of cash flow, statement of changes in equity and the notes to financial statements. The balance sheet gives readers of … [Read more...]
How to Prepare a Trial Balance
A trial balance is an internal accounting statement prepared to check the accuracy of the company’s accounting records. As the “trial” on its name suggests, it is made to check if there are errors committed during the accounting process, which involves journalizing and posting … [Read more...]