Business – 10.1 Financial statements – Statement of financial position | e-Consult
10.1 Financial statements – Statement of financial position (1 questions)
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The statement of financial position, also known as the balance sheet, is a financial report that presents an entity’s assets, liabilities, and owners’ equity at a specific point in time.
Its primary purpose is to provide users (such as investors, creditors, and management) with a snapshot of the company’s financial health, showing what the business owns, what it owes, and the residual interest of the owners. This information helps users assess liquidity, solvency, and the ability to generate future cash flows.