As a practical matter most companies prepare financial statements:
A)after every transaction.
B)only when both the balance sheet and income statement are affected.
C)at the end of the accounting period.
D)at the close of every business day.

Question

Quizplus · Accepted Answer

Financial statements are usually prepared at the end of the accounting period (e.g. monthly, quarterly, or annually) to summarize the financial performance and position of the company during that period. This allows for accurate and comprehensive reporting of financial information to stakeholders, such as investors, creditors, and management. It is not practical or necessary to prepare financial statements after every transaction or every business day, as it would be inefficient and time-consuming. Financial statements are typically prepared when both the balance sheet and income statement are affected, but this does not necessarily occur after every transaction.

As a Practical Matter Most Companies Prepare Financial Statements