Which of the following best describes the proper accounting for interim financial reports?
A)The interim period is viewed as an integral part of the annual accounting period.
B)The interim period is viewed as a distinct, independent accounting period.
C)Interim reports should include the same level of disclosure as annual reports.
D)Net income should be computed on the cash basis except for sales, cost of goods sold, and depreciation.

Question

Which of the following best describes the proper accounting for interim financial reports?
A)​The interim period is viewed as an integral part of the annual accounting period.
B)​The interim period is viewed as a distinct, independent accounting period.
C)​Interim reports should include the same level of disclosure as annual reports.
D)​Net income should be computed on the cash basis except for sales, cost of goods sold, and depreciation.

Quizplus · Accepted Answer

The interim period is viewed as an integral part of the annual accounting period, and therefore should be reported accordingly. The financial statements should provide a comprehensive snapshot of the company's financial performance and position for the entire year, including the interim period. This allows investors and other stakeholders to make informed decisions based on a complete and accurate picture of the company's financial health. The other answer choices are not supported by generally accepted accounting principles (GAAP) for interim financial reporting.

Which of the Following Best Describes the Proper Accounting for Interim