Discussion

Financial Statements

Suppose you have just finished your undergraduate education in business administration and are appearing for your first job interview. The interviewer asks you:

You have just one hour to gain a brief understanding of a company's current performance. What information could you ask for that will help you to have a quick understanding of the company's performance within a very short time?

What might your answer be? What information could you ask for?

Financial statements are important tools that stakeholders can use to better understand the financial health of an organization and make informed decisions.

For this Discussion, read this week's resources. Then, consider the purpose of a balance sheet, an income statement, and a cash flow statement in terms of their functionality, accuracy, and importance. Also, consider how these financial statements are used by investors, lenders, and corporate managers when making decisions.

Post by Day 3, a 150- to 200-word explanation of balance sheets and income statements in terms of functionality, accuracy, and importance. Also, explain how these statements are used in different ways by investors, lenders, and corporate managers when making decisions. In your post, mention whether you have had any experience working with a balance sheet or an income statement to make financial decisions in your personal life or in your organization. If so, please describe the experience. If you have not had any experience with working with a balance sheet or an income statement, please explain how you can use your knowledge about these financial statements to make prudent financial decisions in your personal life. Be sure not to disclose the name of any specific organization.

Support your work with specific citations from the Learning Resources and any additional sources.

Read a selection of your colleagues' postings.

Respond by Day 6 to two or more of your colleagues' postings in one or more of the following ways:

• Ask a probing question.
• Share an insight from having read your colleague's posting.
• Offer and support an opinion.
• Make a suggestion.
• Expand on your colleague's posting.

Return to this Discussion in a few days to read the responses to your initial posting. Note what you learned and the insights you gained from the comments your colleagues made.

Note: Refer to the Discussion Template in this week's Learning Resources for your main post and response.

Learning Resources

This page contains the Learning Resources for this week. Be sure to scroll down the page to see all of this week's assigned Learning Resources.

Required Resources

Readings

• Ross, S. A., Westerfield, R. W., & Jordan, B. D. (2012). Essentials of corporate finance (8th ed.). New York, NY: McGraw-Hill/Irwin.

o Chapter 1, "Introduction to Financial Management" (pp. 1-21)
o Chapter 2, "Financial Statements, Taxes, and Cash Flow" (pp. 22-51)
o Media