What Are the Key Financial Statements Entrepreneurs Should Prepare?
Entrepreneurs should prepare three key financial statements: the income statement, the balance sheet, and the cash flow statement. The income statement shows the company’s revenues and expenses over a specific period, highlighting profitability. The balance sheet provides a snapshot of the company’s assets, liabilities, and equity at a particular point in time, indicating financial stability. The cash flow statement tracks the inflows and outflows of cash, helping entrepreneurs manage liquidity.