The Balance Sheet is a major financial statement prepared at the end of each accounting period. It reflects a balance between an organization’s assets and claims to its assets called liabilities and owners’ equity. This statement is also referred to as a statement of financial position.
The Income Statement also called the statement of earnings, the profit and loss statement, the statement of operations, reports the success of the hospitality property’s operations for a period of time. This statement may be prepared on a weekly or monthly basis for management’s use and quarterly or annually for outsiders such as owners, creditors, and governmental agencies.
The Statement Cash Flow (SCF) shows the effects on cash of a business’s operating, investing, and financing activities for the accounting period. It explains the change in cash for the accounting period; that is, if cash increases by $5000 from January 1, 20X1 (the beginning of the accounting period), to December 31, 20X1 (the end of the accounting period), the SCF will reflect the increase in the sum of cash the firms’ various activities.
The Statement of Retained Earnings is prepared for the corporate form of business organization. Its purpose is to compute the amount of earnings retained by the corporation. Retained Earnings represents the lifetime profits of the business that have not been declared as dividends to the shareholders.
Hospitality Industry Managerial Accounting by R.S. Schmidgall