ASSIGNMENT 1: Balance Sheet versus Income Statement
Part A
Study the article Sample Balance Sheet and Income Statement for Small Business to answer the following questions in a 250-word essay:
- What is the difference between the balance sheet and the income statement?
- How can the information on both statements influence your investment decision-making?
FreshBooks. (2022, July 11). Sample balance sheet and income statement for small businessLinks to an external site.. https://www.freshbooks.com/hub/reports/sample-balance-sheet-and-income-statement-small-business
Part B
Apply what you learned in Part A. Read the scenario below and complete the statements. Be specific as to which statement you are addressing.
Emilio is trying to decide whether to buy a used pickup truck or a new one for his business. The used truck costs less, but Emilio is concerned it will need a lot of costly repairs because it’s an older model. The new truck will likely have higher insurance costs and a larger monthly payment. Based on your spending experience and personal knowledge, what would you recommend to Emilio?
If Emilio decides to buy the new truck, how would that affect both the income statement and balance sheet?
- The income statement will...
- The balance sheet will...
Submission Instructions:
- The writing is to be clear and concise, and you will lose points for improper grammar, punctuation, and misspelling.
- The Part A essay is to be no shorter than 250 words and no more than 300 words. You will automatically lose points if these limits are not followed.
- Add your answers for Part B after the conclusion of the essay.
- Attach the completed balance sheet and income statement to the end of the essay
