Which Is the Best Description of the Relationship Between the Statement

question 31

Multiple Choice

Which is the best description of the relationship between the statement of financial performance and the statement of financial position?

• A)There is no direct relationship between the statement of comprehensive income and the statement of financial position.
• B)The opening statement of financial position plus the profit equals the closing statement of financial position.
• C)The statement of financial position is the link between two statement of comprehensive incomes.
• D)The statement of financial performance explains the change in equity that arises from operating activities.

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Definitions:

Red Herring

A preliminary prospectus distributed to prospective investors in a new issue of securities.

Preliminary Prospectus

An initial document provided by a securities issuer that details the investment offering for potential investors but is not yet approved by the relevant authority.

Seasoned Equity Offering (SEO)

A sale of equity shares by a company that has already gone public through an additional public offering.

Green Shoe Option

A clause contained within the underwriting agreement of an IPO that allows underwriters to purchase up to an additional 15% of shares at the offering price.