Connect Access Card for Financial and Managerial Accounting
Connect Access Card for Financial and Managerial Accounting
18th Edition
ISBN: 9781260006476
Author: Jan Williams, Susan Haka, Mark S Bettner, Joseph V Carcello
Publisher: McGraw-Hill Education
Question
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Chapter 2, Problem 1STQ
To determine

Find out the features of financial statements from the options that are given.

Expert Solution & Answer
Check Mark

Answer to Problem 1STQ

Options of a, b and d are correct answer.

Explanation of Solution

Financial statements: Financial statements are condensed summary of transactions communicated in the form of reports for the purpose of decision making.

Justification for the incorrect option c:

Includes notes disclosing information necessary for the proper interpretation of the statements is not a feature of financial statements. Therefore it is an option c incorrect.

Justification for the correct options a, b and d:

A primary source of financial information is a company’s’ financial statements, following are the features of financial statements:

  • Financial statements provide insight in to current years’ financial status of the Company.
  • It provides investors, creditors and other interested parties a wealth of useful information.
  • It assists in determining the amount of income taxes payable by a business organization for filing income tax returns to the Internal Revenue Service.

Therefore, from the above explanation Options of a, b and d are correct and the other option of c is incorrect.

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Chapter 2 Solutions

Connect Access Card for Financial and Managerial Accounting

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