If you`re a construction contractor, it`s important to keep your financial statements organized and up-to-date. Not only will this help you stay on top of your finances, but it will also help you make strategic business decisions and attract potential investors or lenders.
To get started, it`s helpful to have a sample financial statement as a guide. Here`s what you can expect to see on a typical construction contractor financial statement:
The income statement, also known as the profit and loss statement, shows your company`s revenue and expenses over a specified period of time, usually a year. This statement will give you a clear picture of your overall profitability.
The balance sheet gives you a snapshot of your company`s financial position at a specific point in time by showing your company`s assets, liabilities, and equity. This statement will help you understand your company`s financial health and solvency.
Cash Flow Statement
The cash flow statement shows how cash flows in and out of your company during a specific period of time. This statement is important because it will help you determine your company`s ability to generate cash to meet financial obligations.
In addition to these three statements, you may also find additional information on your financial statement, such as:
– Notes to the financial statement, which provide additional details and explanations about specific line items on the statement
– A statement of retained earnings, which shows how much of your company`s earnings were reinvested in the business rather than paid out to shareholders
– A statement of changes in equity, which shows how your company`s equity has changed over a specified period of time.
Overall, a well-organized and accurate financial statement is essential for any construction contractor. By using a sample financial statement as a guide, you can ensure that your own statements are informative, accurate, and useful for making informed business decisions.