ACCOUNTING CYCLE OF
A CORPORATION
Analyzing Financial Statements
TRIAL BALANCE
 Trial
Balance – is a summary of
accounts with open balances.
The equality of debit and credit
balances in the ledger should be
tested periodically by preparing
trial balance.
What is Trial Balance?
INCOME STATEMENT
This
financial
statement
presents income, expenses
and the performance of the
company, which is either net
income or loss
What is Income Statement?
Income Statement

Selling
Expenses
Costs
that
a business incurs to market and distribute
its products that can include such things
as advertising, commissions and salaries, sal
esoffice expenses, and shipping charges.
Selling expenses are a form of operating
expense and are included on a business'
income statement for the period in which
they
occurred
under
the
accrual
method
of
accounting.
Income Statement

The expenses that an organization incurs
not directly tied to a specific function such
as manufacturing/production or sales.
These expenses are related to the
organization as a whole as opposed to an
individual department; also referred to as
"administrative
cost."
BALANCE SHEET
A
Statement of Financial Position
is a formal statement of the
assets, liabilities and owner’s
equity of the business as of a
given date.
What Is Balance Sheet?
SHAREHOLDER’S EQUITY SECTION
CAPITAL STATEMENT