Comprehensive Review of Financial Statements Pt. 1

Question 1

It is the means by which the information accumulated and processed in financial accounting is periodically communicated to users.

Answer 1

Financial Statements

Question 2

It is the end product of the main output of the financial accounting process.

Answer 2

Financial Statements

Question 3

What are the components of a complete set of financial statement?

Answer 3

1. Statement of Financial Position
2. Income Statement
3. Statement of Comprehensive Income
4. Statement of Changes in Equity
5. Statement of Cash Flows
6. Notes, comprising a summary of significant accounting policies and other explanatory information

Question 4

Its objective is to provide information about an entity’s financial position, financial performance, and cash flows.

Answer 4

General purpose financial statements

Question 5

To meet the objective of a financial statement, what are the information being provided?

Answer 5

1. Assets
2. Liabilities
3. Equity
4. Income and Expenses, Gains and Losses
5. Contributions by and Distributions to owners
6. Cash Flows

Question 6

It is a formal statement showing the three components: Assets, Liabilities, and Equity.

Answer 6

Statement of Financial Position

Question 7

Investors, creditors, and other users analyze the financial position to evaluate factors such as what?

Answer 7

Liquidity
Solvency
Need for dditional financing

Question 8

It is a resource controlled by the entity as a result of past events and from which future economic benefits are expected to flow to the entity.

Answer 8

Assets

Question 9

These are properties owned.

Answer 9

Assets

Question 10

The cash or cash equivalent is a current assets unless what?

Answer 10

Unless it is restricted from being exchanged
Used to settle a liability for at least 12 months AFTER the reporting period

Question 11

What is the classification of all other assets not classified as current?

Answer 11

Non-current Assets