Financial Statements Are Typically Prepared in the Following Order

question 374

Multiple Choice

Financial statements are typically prepared in the following order:

• A)Balance sheet,statement of retained earnings,income statement.
• B)Statement of retained earnings,balance sheet,income statement.
• C)Income statement,balance sheet,statement of retained earnings.
• D)Income statement,statement of retained earnings,balance sheet.
• E)Balance sheet,income statement,statement of retained earnings..

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Definitions:

General Journal

A primary accounting record where all financial transactions are initially recorded, before being posted to specific accounts in the ledger.

Horizontal Analysis

A financial analysis technique that compares historical financial data over a series of reporting periods, using a base year as a comparison.

Vertical Analysis

A method of financial statement analysis in which each entry for each of the three major categories of accounts (assets, liabilities, and equities) in a balance sheet is represented as a proportion of the total account.

Percentage Analysis

A financial analysis technique that evaluates the proportion or percentage change of individual components in financial statements over time.