Financial Statements with Data for Two or More Successive Accounting

question 148

Multiple Choice

Financial statements with data for two or more successive accounting periods placed in columns side by side, sometimes with changes shown in both dollar amounts and percentages, are referred to as:

• A) Comparative statements.
• B) Successive statements.
• C) Controlling statements.
• D) Period-to-period statements.
• E) Serial statements.

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Definitions:

Inventory

An accounting term referring to goods and materials held by a business for the purpose of sale or production.

Net Present Value

A method used in capital budgeting to assess the profitability of an investment or project by calculating the difference between the present value of cash inflows and outflows.

Operating Cash Flows

Operating cash flows refer to the amount of cash generated by a company's normal business operations, intended to sustain and grow the business.

Net Working Capital

The spread between a firm's existing assets and ongoing liabilities, signifying the company's financial viability in the short term.