Which of the following is a difference between personal financial statements and business financial statements?
A) Personal financial statements follow the cost principle, whereas business financial statements do not follow the cost principle.
B) Personal financial statements should present assets at estimated current values, whereas business financial statements should present assets at historical cost.
C) Personal financial statements are not governed by GAAP, whereas business financial statements are governed by GAAP.
D) Personal financial statements are prepared for a specific period of time, whereas business financial statements are prepared for a general period.

Question

Quizplus · Accepted Answer

Personal financial statements should present assets at estimated current values, whereas business financial statements should present assets at historical cost. This is because personal financial statements are focused on individual's net worth, while business financial statements are focused on the company's earnings and assets. Additionally, both personal and business financial statements are governed by GAAP. The other choices are incorrect statements.

Which of the Following Is a Difference Between Personal Financial