Which of the following statements is untrue?

Recognition requires that revenues be recorded when earned which is not necessarily when cash is received.
An annual income statement summarizes revenues earned; less expenses incurred over the year.
An annual balance sheet shows changes in a business's assets, liabilities, and equity during the year.
Matching requires that financial transactions be reported in the period in which they occurred.
The Business Entity Principle requires that each economic entity maintain separate records.

Solutions

Expert Solution

The correct answer is C.An annual balance sheet shows changes in the business's assets, liabilities, and equity during the year.

All the other statements are true except option 'C'.

As changes in assets, liabilities, and shareholder's equity are stated in cash flow statement.

ekkarill92 answered 1 year ago

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