What information could a financial analyst potentially obtain by reviewing the statement of activities?
A)whether the resources obtained during the year were sufficient to cover the cost of providing services
B)whether services provided were sufficient for the government's constituencies
C)the current financial condition of a government
D)the current status of a government's assets and liabilities

Question

Quizplus · Accepted Answer

The statement of activities shows the revenues and expenses incurred by a government entity during a specific period. By reviewing this statement, a financial analyst can determine whether the resources obtained, i.e. revenues generated, during the year were sufficient to cover the cost of providing services, i.e. expenses incurred. This helps in assessing the financial health of the government entity. The other options are not directly related to the statement of activities.

What Information Could a Financial Analyst Potentially Obtain by Reviewing