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What are the two most important

financial summary statements of a
business?
a. Working capital and depreciation reports
b. Balance sheet and income statement
c. Cash flow and asset reports
d. Tax returns and asset report

1 Answer

7 votes

Final answer:

The two most important financial summary statements of a business are the balance sheet, which shows assets, liabilities, and net worth at a certain point, and the income statement, reflecting the company's revenue and expenses over a period.

Step-by-step explanation:

The two most important financial summary statements of a business are the balance sheet and the income statement. A balance sheet provides detailed information about a company's assets, liabilities, and shareholders’ equity at a specific point in time. It is an essential report that shows the company's net worth, which is calculated by subtracting liabilities from assets. The income statement, on the other hand, shows the company's revenues and expenses over a period of time. This statement demonstrates the company's ability to generate profit during the specified time frame. Both statements are crucial for understanding the financial health and performance of a business.

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