CHAPTER 2
A FURTHER LOOK AT FINANCIAL STATEMENTS
LEARNING OBJECTIVES
After studying this chapter, you should be able to:
- Identify the sections of a classified balance sheet.
- Identify tools for analyzing financial statements and ratios for computing a company's profitability.
- Explain the relationship between a retained earnings statement and a statement of stockholders’ equity.
- Identify and compute ratios for analyzing a company's liquidity and solvency using a balance sheet.
- Use the statement of cash flows to evaluate solvency.
- Explain the meaning of generally accepted accounting principles.
- Discuss financial reporting concepts.
Feature Story
JUST FOOLING AROUND?
Few people could have predicted how dramatically the Internet would change the investment world. One of the most interesting results is how it has changed the way ordinary people invest their savings. More and more people are striking out on their own, making their own investment decisions.
Two early pioneers in providing investment information to the masses were Tom and David Gardner, brothers who created an online ...
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