Net cash flow can be calculated from balance sheet alone. Then why do we need a separate financial statement - cash flow statement? Read on.

What is cash flow statement? Similar to how you bookkeep your own expenses for the house, you can do the same for your business.

After paying all the expenses and taxes, we've managed to get some profit. How does profit distribution affect balance sheet and income statement?

Should research and development expenses be treated as expenses or intangible assets? This one explains the concept in depth.

Once you make a sales, you move some of your inventory (balance sheet) into cost of goods sold (income statement). But how does a sale affect these financial statements exactly? Read more.

Variable cost vs. fixed cost is one of the most important concepts in managing a company. Knowing it will help entrepreneurs make smarter decisions.

If you have read my last post, you know that our fictional

Having a financial mindset helps an entrepreneur build resource allocation skills and judgments. Here we discuss how to prepare balance sheet to help cultivate that understanding.

The undistributed profit goes into retained earnings. This is the most direct relationship between income statement and balance sheet.

To know whether your biz makes a profit, you have to understand Income Statement - the formula that tells if you make a profit or loss.

Assets equal Liabilities plus Shareholders' Equity. But what can this equation and all the information on Balance Sheet tell us? Read this guide to learn the basics.

Learn about the structure of shareholder's equity, and how capital stock, additional paid-in capital, surplus reserve, and retained earnings work.