balance sheet or income statement

The balance sheet is a financial statement that provides a snapshot of a company’s financial position at a specific point in time. It lists the company’s assets, liabilities, and shareholders’ equity, giving insight into what the company owns, owes, and the residual interest of the owners. The balance sheet follows the fundamental accounting equation: Assets = Liabilities + Shareholders’ Equity. This statement helps investors, creditors, and management assess the company’s liquidity, financial stability, and capital structure The income statement, also known as the profit and loss (P&L) statement, shows a company’s financial performance over a specific period, such as a quarter or year. It outlines the company’s revenues, expenses, and profits or losses, helping stakeholders understand how well the company generates profit from its operations. By showing the company’s ability to generate revenue and manage expenses, the income statement provides crucial insights into profitability and operational efficiency