Financial Statement Analysis

Financial Statements Analysis

Part 1: Introduction Financial Statements Analysis

Financial statement is a collection of data organized according to logical and consistent accounting procedures. Account data that had made in journal it will be continued and will be used at financial statement. Result of financial statement analysis is capability of corporate in period time which contained information about financial position, profit-loss account information and cash flow information.

A. Type of Financial Statements

1. Balance sheet

Balance sheet use for describe financial position about financial capital, debt and asset in corporate. A balance sheet is often described as a "snapshot of a company's financial condition" Of the four basic financial statements, the balance sheet is the only statement which applies to a single point in time of a business' calendar year

2. Profit or Loss Statements

Profit or loss statement is a company’s financial statement that indicates how the revenue is transformed into the net income. Net income is income received from sale of product either service before expenses, interest, tax and amortization are taken out.

3. Cash Flow Statements

Cash flow is the movement of cash into or out of a business, project, or financial product. (Note that "cash" is used here in the broader sense of the term, where it includes bank deposits.) It is usually measured during a specified, finite period of time. Measurement of cash flow can be used for calculating other parameters that give information on the companies' value and situation. Cash flow can e.g. be used for calculating parameters.

B. Comparing

Summary from financial statement will be process to identify financial ratio in corporate. Financial ratio is comparing financial statement summary from another corporate or another period of time. In this case, corporate wants to compare must have same input account method and core business before it want to compare. Input account method is method that record input and output goods in factory. FIFO and LIFO is type of method that record input account.

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