Profit and Loss Account: A Profit and Loss Account provides a summary of financial gains and losses in a business during a specific period. It includes revenues, expenses, and the resulting profit or loss.

 

Specific and General Reserves: Reserves are allocated portions of profit that are kept aside for specific or general purposes. They ensure the financial stability of a business and are used for various reasons, including meeting future obligations, funding growth, or providing a safety net during tough times.

What is the value of a cash flow statement?

1) Provides an annual summary

2) Shows the profitability at a specific point in time

3) shows actual cash in the firms account

4) projects future profit

1.A business pays off a note payable. What effect does this have on the accounting? equation? A. Assets? increase, Liabilities remain the? same, and? Stockholders' Equity increases. B. Assets? increase, Liabilities? decrease, and? Stockholders' Equity remains the same. C. Assets? decrease, Liabilities remain the? same, and? Stockholders' Equity increases. D. Assets? decrease, Liabilities? decrease, and? Stockholders' Equity remains the same

2.

If Total Assets remain the same and Total? Stockholders' Equity? increases, Liabilities? will:

A.

increase by the same amount.

B.

decrease by the same amount.

C.

increase by a different amount.

D.

remain the same.

The Income Statement is used to? report:

A.

the financial position for a specific period.

B.

results of operations for a specific date.

C.

the financial position on a specific date.

D.

results of operations for a specific period.

The Balance Sheet is used to? report:

A.

results of operations for a specific period.

B.

the financial position for a specific period.

C.

the financial position on a specific date.

D.

results of operations for a specific date.