1. Financial Records & Statements Ch. 12-2 PoB 2011

2.  Financial Records – are used to record and analyze the financial performance are maintained Financial Records

3.  Assets Records – identify the buildings and equipment owned by the business, their original and current value, and the amount owed if money was borrowed to purchase the assets  Depreciation Records – identify the amount assets have decreased in value due to their age and use  Inventory Records - identify the type and quantity of resources and products on hand along with the current value of each Types of Records

4.  Records of Accounts – identify all purchases and sales made using credit  Cash Records – list all cash received and spent by the business  Payroll Records – contain information on all employees of the company, their compensation, and benefits  Tax Records – show all taxes collected, owed and paid Types of Records

5.  The three most important elements of a company’s financial strength are:  Assets – what a company owns  Liabilities - what a company owes  Owner’s Equity – is the value of the owner’s investment in the business  Financial Statement – report that sums up the financial performance of a business  Balance Sheet – reports a company’s assets, liabilities and owner’s equity Financial Statements

6. Balance Sheet

7.  Three other key financial elements for a business are the amount of:  Sales  Expenses  Profits  All are reported on the company’s Income Statement Income Statement

9.  Shows the total sales and revenue over a period of time, normally quarterly, to determine if their was a profit or loss in sales Profit and Loss Statement

10. 1.How has the process of maintaining financial records been affected by technology? 2.What is the difference between a balance sheet and an income statement? Review