Essay4 - Write a 500-1,000-word essay describing why...

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Write a 500-1,000-word essay describing why financial statements are prepared in a specific order and what documents they are prepared from. Creating financial statements for your business is an important task that will help you know if your business is decreasing or increasing. A way to find out is to have the financial statements prepared in a specific order. Financial statements are prepared from the adjusted trial balance. The adjusted trial balance is a list of all accounts with their adjusted balances. The purpose of the trial balance is to verify that debits equals credits before preparing the financial statements. An adjusted trial balance is necessary for end of month adjustments for a business. (2014) Financial statements have to be prepared in a specific order because information in one statement is needed for the next statement. There are three financial statements. They are the Income Statement, Statement of Owner’s Equity and Balance Sheet. The

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