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    Financial Statements: Basics and Purposes

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    Explain the purpose of each of the 4 basic financial statements? How do managers and employees use them? How about investors and creditors?

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    1. Balance sheet
    Purpose: To show the economic resources (assets), liabilities and the net (equity) at a point in time.

    2. Income Statement
    Purpose: To show if the revenues of the period exceed the expenses of the period (profit) or not.

    3. Statement of Cash Flow
    Purpose: To show the sources and uses of cash, sorted by operating, investing and financing activities.

    4. Statement of ...

    Solution Summary

    Your tutorial is 246 words and describes the four basic financial statements and gives examples of how managers, employees, creditor and investors may use the financial statements.