Learn how to analyze a company's balance sheet, including assets, liabilities, and equity, for smarter investment decisions.

The link between a balance sheet and an income statement is obvious, but it's also tricky. The more income your business earns, the more value should show up on its balance sheet. But the calculations ...

A balance sheet provides a snapshot of a company's assets, liabilities and equity at a specific point in time, while an income statement summarizes its revenues and expenses over a period to show ...

Understanding how the income statement affects the balance sheet is not that difficult. The two concepts fit together like pieces of a dynamic puzzle. In this case, the puzzle is the financial ...

A balance sheet displays what a company owns, what it owes, how it's financed, and its shareholders' equity at a particular point in time. An income statement displays the company's revenues and ...

Net income is found by adjusting owners' equity for profits, losses, and capital changes. Use owners' equity changes to determine company profit or loss for accouting periods. One of the benefits of ...

The more money a business takes in, the more money its owners are likely to make. A company's net income therefore plays a significant role in determining owner's equity. Net incomeNet income is ...

A company's net income seems like a simple concept that measures how profitable a business is. However, many investors have the misconception that net income automatically translates to an increase in ...

In accounting, every financial transaction is recorded by two entries on the company's books. These two transactions are called a "debit" and a "credit," and together, they form the foundation of ...