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3.4 FINAL ACCOUNTS (THE BALANCE SHEET (Fixed assets (tangible assets, have…

- - - - ; Detailed profit and loss account with as much info as possible
      - ; produced as frequently as managers need the info
    - - ; Less detailed summary
      - ; produced at least once a year
      - ; prevent competitors
    - - The trading account
        
        shows how gross profit has been made from the trading activities of the business
        
        sales turnover is not the same as cash received
      - Profit and Loss section
        
        calculates both the operating profit and the profit after tax of the business
      - Appropriation account
        
        shows how the profits after tax of the business are distributed between the owners
        
        dividends = shareholders
        
        retained profits
    - - measure and compare the performance of a business over time or with other firms
      - actual profit data can be compared with the expected profit levels of the business
      - provide info to bankers and creditors to decide whether to lend money
      - provide access of the investing value to potential investors