Which of the following is a true statement?
A) Accounting income is generally equal to firm cash flow.
B) Accounting statements are usually prepared to match the timing of income and expenses.
C) The statement of financial position equity account represents the market value of the firm to shareholders.
D) The statement of financial position tells investors exactly what the firm is worth.
E) Assets are usually listed on the statement of financial position at market value.

Question

Quizplus · Accepted Answer

Accounting statements, including the income statement, are prepared on an accrual basis, meaning income and expenses are matched to the period they relate to, regardless of when cash transactions occur. This helps in understanding the financial performance of a company over a specific period.

Which of the Following Is a True Statement