1.5 Understand and be able to prepare basic financial statements.
1) The statement of retained earnings is prepared to determine the final amount of retained earnings to show on the statement of financial position.
2) The income statement details how cash changed over an accounting period or cycle.
3) The statement of financial position is reported as a specific date.
4) Financial statements are prepared primarily for internal company use.
5) A statement of cash flows is usually prepared last.
6) Which of the following financial statements illustrates the accounting equation?
A) Statement of retained earnings
B) Income statement
C) Balance sheet
D) Statement of cash flows
7) What is the income statement used to report?
8) The net income figure is needed to prepare a financial statement. Name the financial statement.
9) Name the first financial statement prepared.
10) Name the last financial statement prepared.