How do you read financial statements
Learn how income statements, balance sheets, and cash flow show a company’s story, health, and real money movement.
A financial statement shows how a company is doing. There are three main parts.
• The income statement shows money the company earned and money it spent. The final number is the profit or the loss.
• The balance sheet shows what the company owns and what it owes. It shows how strong or weak the company is.
• The cash flow statement shows real money coming in and real money going out. It tells you if the company can pay its costs.
In simple words
Income statement tells the story.
Balance sheet shows the health.
Cash flow shows the truth.