The Financial Statement That Reports Whether the Business Earned a Profit

question 228

Multiple Choice

The financial statement that reports whether the business earned a profit and also lists the revenues and expenses is called:

• A) A Balance sheet (Statement of Financial Position).
• B) A Statement of changes in equity.
• C) A Statement of cash flows.
• D) An Income statement (Statement of Comprehensive Income).
• E) A Statement of financial position.

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Definitions:

Investment

Investment refers to the act of allocating resources, usually money, with the expectation of generating an income or profit.

Periodic Interest Rate

The interest rate charged on a loan or realized on an investment over a specific period of time.

Compounded Quarterly

This term describes the method of calculating interest by adding the interest to the principal sum every quarter, leading to compound interest.

Compounded Semi-annually

Interest that is calculated and added to the account balance twice a year.