The Purpose of a Statement of Stockholders' Equity Is to

question 187

Multiple Choice

The purpose of a statement of stockholders' equity is to

• A)disclose the computation of book value per share of stock.
• B)budget the transactions expected to occur during the forthcoming period.
• C)replace the statement of retained earnings.
• D)summarize the changes in the components of stockholders' equity for a period of time.

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Definitions:

Subsidiary Posting

The process of transferring entries from the journal to the individual ledger accounts, often for the purpose of detailed accounting and tracking.

Purchases Journal

A record used in accounting to track all acquisitions of merchandise, inventory, and supplies on credit.

Purchases Journal

A record keeping tool used in accounting to track all purchases made by a business, including inventory, supplies, and services.

Subsidiary Posting

The process of transferring details from the journal into subsidiary ledgers, which help in maintaining detailed information on individual account balances.