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Unformatted text preview: (receipts) and outflows (payments) for a specific period of time. The four financial statements are prepared in the sequence shown, for the following reasons: Net income is computed first and is needed to determine the ending balance in retained earnings. The ending balance in retained earnings is needed in preparing the balance sheet. The cash shown on the balance sheet is needed in preparing the statement of cash flows. five subdivisions of stockholders equity: common stock, retained earnings, dividends, revenues, and expenses...
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This note was uploaded on 06/19/2011 for the course FIN 402 taught by Professor Sandymcdonald during the Spring '11 term at University of Phoenix.
- Spring '11