28.03.2023 - 16:02

Which of the following is false regarding the balance sheet? A. The accounts shown on a balance sheet represent the basic accounting equation for a particular business. B. The retained earning balance shown on the balance sheet must agree with the ending

Question:

Which of the following is false regarding the balance sheet?

A. The accounts shown on a balance sheet represent the basic accounting equation for a particular business.

B. The retained earning balance shown on the balance sheet must agree with the ending retained earning balance shown on the statement of retained earnings.

C. The balance sheet summarizes the net changes in specific account balances over a period of time.

D. The balance sheet reports the amount of assets, liabilities, and stockholders equity of a business at a point in time.

Answers (1)
  • i1uxa
    April 8, 2023 в 03:33

    The false statement regarding the balance sheet is option C: "The balance sheet summarizes the net changes in specific account balances over a period of time."

    Explanation: A balance sheet is a financial statement that provides information about the financial position of a company at a specific point in time, usually at the end of a fiscal year or accounting period. It presents the assets, liabilities, and equity of a business, and represents the basic accounting equation: Assets = Liabilities + Equity.

    Option A is true because the accounts shown on a balance sheet represent the basic accounting equation for a particular business.

    Option B is also true because the retained earning balance shown on the balance sheet must agree with the ending retained earning balance shown on the statement of retained earnings, which reports the changes in retained earnings during a period.

    Option D is true because the balance sheet reports the amount of assets, liabilities, and stockholders equity of a business at a specific point in time.

    Option C is false because the balance sheet does not summarize the net changes in specific account balances over a period of time. Instead, it provides a snapshot of a company's financial position at a specific point in time. The income statement, statement of retained earnings, and cash flow statement are the financial statements that summarize the net changes in specific account balances over a period of time.

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