Income Statements and Balance Sheets...

This week in Finance, we learned about the importance of having a balance sheet and an income statement in business. Business owners/companies need to be able to reconcile statements and have an idea of their financial standing. This is where the balance sheet and the income statements come in. The balance sheet helps a company to keep an accounting of its assets, while the income statement helps a company to have an understanding of how they are doing financially. So not only did we discuss this in our discussion board this week, but we also had to create a balance sheet and income statement for the listed corporation in the problem we did. It is somewhat tedious, but just think if all companies left everything to chance and never kept an accounting of how money was spent and how much money was actually coming in compared to how much money was going out; many businesses would be bankrupt.

Next week, we are supposed to be getting started on creating and tracking portfolios. If it's anything like the financial plan that we did for our other finance class, I look forward to being challenged and learning more about tracking financial progress through investments--both long-and-short term.