I would add:
Assets - Liabilities = Company Value
Assets = cash, aircraft, slots, prepayments (leases, deposits for purchasing aircraft)
Liabilities = loans, lease prepayments received
Balance Sheet = statement of assets and liabilities and resulting company value
Income Statement = statement of revenues and expenses including non-cash transactions (depreciation, prepaid leases converting from an asset to an expense)
Cashflow Statement = statement of cash flows in and out of the business
Here is also a quick "primer" on the differences between to two accounting methods which should be helpful: http://www.investopedia.com/ask/answers/09/accrual-accounting.asp
A good example to include would be airlines IRL. If you buy a plane ticket today for $500, the airline takes your $500 and their cash increases by $500 (shown on cashflow statement). However, they have a liability on the books of $500 (providing the flight you paid for). So their assets increase by $500 and their liabilities increase by $500 and the company value does not change.
When the flight occurs, the ticket you purchased is no longer a liability for the airline and liabilities decrease by $500. The $500 is booked as revenue for the day the flight occurred as are operating expenses to fly the aircraft between airports. If it cost the airline $450 to fly you from point A to point B, then their cash (assets) would decrease by $450 with a net effect of increasing company value by $50.
If you were flying a brand new aircraft that was purchased for $100 million that day, the aircraft is now used and no longer worth $100 million. It did not cost the airline $100 million to conduct the single flight, so in order to allocate costs across the life of the entire aircraft instead of just the first day, depreciation is used. If an aircraft is worth $100 million and flown for 20 years, that means the aircraft costs roughly $5 million/year to operate. Much like the airline ticket, the expenses are allocated to the timeframe they were realized. So Year 1 would show $5 million in depreciation as an operating expense, Year 2 would be $5 million, and so on. If the aircraft is sold after 5 years and $25 million in depreciation, the book value of the aircraft is $75 million. If the aircraft is sold on the used market for $80 million, the airline would pay taxes on $5 million in income versus a $20 million loss ($100 million - $80 million) because the airline already took $25 million in expenses/losses on the aircraft through depreciation expenses.