Elements of financial statements

The 3 components of financial statements are :
1. Assets
2. Equity
3. Liability

Assets
Asset is economic resource which the entity owns or controls.
These can be fixed ( like property, plant ) with life of more than 1 year
                                      OR
current ( like cash, inventory, accounts )

Liability 
Liability is obligation of enterprise which will result in outflow of economic resources in future.
It can be current (like accounts payable or bank overdrafts ) or long term(like bank loan) with life more than year.

Equity or net assets
Equity = Assets - liability

Some other terms
Revenue or income represents the income that a business generates
Expenses - costs associated with running the business like wages, electricity bills
Gain - Increase in equity arising from the transactions outside of an entity's normal operating.
Loss - Opposite of gain

Assets

What Does Asset Mean?
1. A resource with economic value that an individual, corporation or country owns or controls with the expectation that it will provide future benefit. 

2. A balance sheet item representing what a firm owns.


Assets may be :

• Physical assets like real estate, gold/jewellery, commodities etc.

• Financial assets such as fixed deposits with banks, small saving instruments with post offices, insurance/provident/pension fund etc. or securities market related instruments like shares, bonds, debentures etc.