CHAPTER 3
The financial statements
‘The longer I go on, the more I am aware of the power of finance.’
Justin Welby
Aim
The aim of this chapter is to understand the primary financial statements of a business and how they interact with each other.
Outcomes
By the end of this chapter you will understand:
- the main elements of the balance sheet
- the main elements of the income statement (also known as the profit and loss account)
- how the balance sheet and income statement interact
- the main elements of the cash flow statement and how it reconciles ...
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