Intenlinkege between financial statements

Question

Accepted Answer

The financial statements are interconnected and provide a comprehensive view of a company's financial performance.

The income statement shows the company's revenues, expenses, and net income or loss for a specific period.
The balance sheet presents the company's assets, liabilities, and shareholders' equity at a specific point in time.
The cash flow statement reports the company's cash inflows and outflows from operating, investing, and financing activities.
The financial statements are linked through various relationships, such as net income affecting retained earnings on the balance sheet.
Changes in balance sheet items can be analyzed using information from the income statement and cash flow statement.

Accepted Answer

Net income from the bottom of the income statement links to the balance sheet and cash flow statement.

Top Visible Alpha Solutions Junior Research Associate interview questions & answers