Personal Financial Situation The Management Of A Essay

Personal Financial Situation The management of a Fortune 500 organization utilizes financial statements to craft corporate strategy on a quarter to quarter and year over year basis. These statements: balance sheet, income statement, and statement of cash flows contain crucial financial information which explicates how successful a company has been and its potential future prospects. These same three statements can be used by me as I face financial scenarios which require examination of assets, income, and its sources.

Financial Statements

I will look to my financial statements as I seek to purchase a home, save for retirement, and contemplate starting a small business. A corporation's financial statements are contained in the annual report distributed to shareholders; my personal financial statement will contain the same data in a single page format. The balance sheet portion "summarizes a company's assets, liabilities and shareholders' equity at a specific point in time (Investopedia. N.D.); similarly the statement will identify what I own and owe. The income statement "measures a company's financial performance over a specific accounting period, summarizing how the business incurs its revenues and expenses" (Investopedia. N.D.). For me the income statement details their income earned...

...

Lastly, the statement of cash flows details "all cash inflows a company receives from both its ongoing operations and external investment sources, as well as all cash outflows that pay for business activities and investments during a given quarter" (Investopedia. N.D.). My statement contains the sources of income and its eventual uses.
Home Ownership

I decide that I no longer wish to rent and instead choose to investigate the possibility of owning a home. After filling out the loan application at the local financial institution using information from my personal financial statement, the loan officer and I review the data. I work at General Electric as a network programmer making $48,000 a year, $4,000 gross a month; information found on the income statement. The bank requires a 20% down payment on the purchase of the $100,000 home. The financial statement (balance sheet) indicates that I have $25,000 in savings which can be used for this purpose. As for expenses and debt I have $1,200 monthly outflow which includes the new mortgage payment. The bank requires that monthly expenses do not exceed 36% of total income; I fall in line at 30%. After further review, a check of employment, and verification of the information on the application the mortgage loan is approved. The financial statements have provided the requisite information for my major life purchase.

Retirement Savings

Confidently set up in my new home two months later, I look at the financial statements to set up plan for saving for retirement. The statement of cash flows section details the $4,000 in income earned from GE, along with the expenses and bills of $1,200 which I pay on a…

Sources Used in Documents:

References

Investopedia. (N.D.). Balance Sheet. Investopedia. Retrieved June 13, 2011 from http://www.investopedia.com/terms/b/balancesheet.asp

Investopedia. (N.D.). Income Statement. Investopedia. Retrieved June 13, 2011 from http://www.investopedia.com/terms/i/incomestatement.asp

Investopedia. (N.D.). Statement of Cash Flows. Investopedia. Retrieved June 13, 2011

from http://www.investopedia.com/terms/c/cashflowstatement.asp


Cite this Document:

"Personal Financial Situation The Management Of A" (2011, June 13) Retrieved April 27, 2024, from
https://www.paperdue.com/essay/personal-financial-situation-the-management-51228

"Personal Financial Situation The Management Of A" 13 June 2011. Web.27 April. 2024. <
https://www.paperdue.com/essay/personal-financial-situation-the-management-51228>

"Personal Financial Situation The Management Of A", 13 June 2011, Accessed.27 April. 2024,
https://www.paperdue.com/essay/personal-financial-situation-the-management-51228

Related Documents
Financial Risk Management
PAGES 8 WORDS 2453

Financial Risk Management Over the past decade, there have been tons of arguments over financial risk management especially if it is logically defensible in financial terms. Most risk managers have been able to observe both a better acceptance of their discipline along with a better enthusiasm on the part of businesses to employ the word "risk management." In the financing and banking business, nevertheless, these attitudinal changes have donated to

personal cash management policies and practices. The paper starts with by stating the methodology through which the content was collected for the relevant literature in the paper. The paper then presents a clear definition of what cash management is and presents an overview of some of the most utilized personal cash management practices. The literature review also presents numerous internal cash management policies and practices that can prove to

Business -- Human Resources Personal Financial Advising Personal financial advisors review the financial needs of people and help them with investments, tax laws, and insurance decisions. Advisors help their clients recognize and plan for both long-range and short-range objectives. Advisors help clients plan for retirement, education expenses, and general investment decisions. Many also supply tax advice or sell insurance. Even though most planners offer advice on a wide assortment of topics, some

Financial Scandals and Management Financial Management Management Financial Actions, Controls, and Decisions Financial Scandals and Management Following the rise of financial scandals in the recent past, external and internal audits are carried out to review the management's financial controls and actions, and keep tab of the outside and internal auditors. However, despite the best efforts, accounting scandals like the Cendant Corporation's $300 million bogus revenue indicate that external auditors and managers are not doing

Management Principles Management Leadership Model Paper: Management Principles Research suggests that everyone is a manager in their own way. For instance, everyone manages his finances, time, careers and relationships. These examples of managing are simple and straightforward. However, when concepts of management apply in organizations, management becomes complex. At such a point, it calls for extensive studying in order to understand the theoretical basis of management. The application of management and the enunciation

She is well-connected within the community and is confident that her business would be profitable within a year or two. She has a strong, charismatic personality and is also connected to Milwaukee's artistic community through her husband's architectural work restoring some of the city's beautiful historic buildings. She has a considerable portfolio, and occasionally sold stock photos or worked as a wedding photographer when she was in law school. Laura