Which of the Following Is the Correct Order of Preparation

question 45

Multiple Choice

Which of the following is the correct order of preparation of financial statements?

• A) Income statement → statement of owner's equity → balance sheet → statement of cash flows
• B) Statement of owner's equity → balance sheet → income statement → statement of cash flows
• C) Balance sheet → statement of owner's equity → income statement → statement of cash flows
• D) Balance sheet → income statement → statement of owner's equity → statement of cash flows

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Definitions:

Cost

The amount of money required to produce, purchase, or maintain a product or service.

Markup Percent

The surcharge applied to the acquisition cost of products for covering overhead and making a profit.

Selling Price

The final amount of money charged for a product or service, or the amount the consumer is willing to pay.

Markup Percent

The percentage increase over the cost price of a product to calculate the selling price.