Which of the Following Statements BEST Defines Financial Statements

question 50

Multiple Choice

Which of the following statements BEST defines financial statements?

• A)Financial statements are the verbal statements made to business news organizations by chief financial officers.
• B)Financial statements are plans and forecasts for future time periods.
• C)Financial statements are the information systems that record and measure business transactions.
• D)Financial statements are documents that report on a business in monetary terms, providing information to help people make informed business decisions.

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Definitions:

CVP Chart

A graphical representation used in Cost-Volume-Profit analysis to show the relationship between costs, volume of sales, and profit.

Major Components

Principal parts or elements that form the larger system or structure.

Break-even Point

The point at which total costs and total revenue are equal, resulting in no gain or loss for the business.

Cost-volume-profit Analysis

An accounting technique used to determine the effects of changes in costs and volume on a company's profit.