What is the order of preparation of financial statements?
A)statement of income, statement of changes in equity, statement of financial position.
B)statement of changes in equity, statement of income, statement of financial position.
C)statement of financial position, statement of income, statement of changes in equity.
D)statement of changes in equity, statement of financial position, statement of income.

Question

Quizplus · Accepted Answer

The correct order of preparation of financial statements is: statement of income, statement of changes in equity, statement of financial position. This sequence ensures that the net income or loss figure from the statement of income is available to be used in the statement of changes in equity, and both of these figures are then used to prepare the statement of financial position.

What Is the Order of Preparation of Financial Statements