It’s take time of the year when you take time to look at what happened this year—financially. There are three essential financial statements that give you an idea of how well your business is doing. Balance Sheet, Income Statement and Cash Flow Statements.
The Balance Sheet is a snapshot of your business for a particular moment in time.
The Income Statement is your profit/loss which is similar to a “report card’ of your business.
The Cash Flows Statement shows how much money come in and how much goes out.
These three financial statements that can be prepared using the data in Quickbooks, if the information in Quickbooks is accurate and up-to-date. If that is true, then all you have to do is go to the Report menu and select the financial statement report that you want to run.
However, you may want to first check to make that your business’ Chart of Accounts is set up properly. Review accounts to make sure that the have the right designation of asset, expense, equity or income. First, let’s look at the Balance Sheet. The main components of a balance sheet are assets, liabilities, and equity.
Balance Sheet includes the following:
Current Assets (cash)
Accounts Receivable (your billing)
Inventory (merchandise inventory–not applicable for service companies)
Non-current Assets (stock purchases)
Fixed Assets (capital assets not expenses)
Current Liabilities (due within one year) It may be unearned income
Loan Payable ( Business Loans)