The purpose of a financial statement that lists an entity's total capital/liabilities is to show:Question 3Answera.The amount of the entity could be sold for in liquidationb.The amount of the entity could be sold as a going concernc.The financial performance of the entity over a period of timed.The financial position of the entity at a particular moment in time
Question
The purpose of a financial statement that lists an entity's total capital/liabilities is to show:Question 3Answera.The amount of the entity could be sold for in liquidationb.The amount of the entity could be sold as a going concernc.The financial performance of the entity over a period of timed.The financial position of the entity at a particular moment in time
Solution
The purpose of a financial statement that lists an entity's total capital/liabilities is to show the financial position of the entity at a particular moment in time. This is option d.
This type of financial statement, often referred to as a balance sheet, provides a snapshot of what a company owns (assets), what it owes (liabilities), and the value of the business to its stockholders (owner’s equity) as of a specific date. It's called a balance sheet because the two sides – assets, on the one hand, and liabilities plus owner’s equity on the other – must balance out. This is a fundamental concept in accounting.
Similar Questions
What is meant by Financial Statement ?
The statement that lists the assets, liabilities and equity of an entity at a specific date is the:Group of answer choicesstatement of cash flows.income statement.balance sheet.statement of financial performance.
Statement listing assets, liabilities and owner's equity.Select one:a.Statement of Financial Positionb.Revenuec.Capitald.Expenses
Link Between Financial StatementsThe following information is available for a company. Income Statement (In ₹ million)Sales revenue2Operating expenses0.45 Operating profit 1.55 Interest expenses 0.22Taxes 0.28Net profit? Cash Flow Statement (In ₹ million)Cash in the beginning 0.75 Cash generated during the year?Cash at the end 1.52 Balance SheetAssetAmount (in ₹ million)Liability and equityAmount (in ₹ million)Fixed assets6Share capital5Cash? Profit for the year?Inventory2.53Owner’s equity? Long-term debt4 Total assets?Total liabilities and equity ? What is the total assets and owner’s equity? Total assets: ₹ 10.05 million; owner’s equity: ₹ 6.05 millionTotal assets: ₹ 15.52 million; owner’s equity: ₹ 6.52 millionTotal assets: ₹ 9.05 million; owner’s equity: ₹ 5.05 million
20.Which financial statement gives details on the equity, liabilities, and assets of a business at a certain moment in time? A. Income statement B. Cash flow statement C. Balance sheet D. Statement of retained earnings
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.