Which financial statement is prepared last out of the following three: balance sheet, statement of cash flows, and the income statement?
A)Balance sheet
B)Statement of cash flows
C)Income statement
D)All three are prepared at the same time
E)None of these are prepared until the statement of owner's equity is prepared

Question

Quizplus · Accepted Answer

The statement of cash flows is the financial statement that is prepared after the balance sheet and the income statement, as it requires information from those two statements to prepare the statement of cash flows.
Key Takeaway: A balance sheet can be prepared at any time, as it provides a snapshot of the company's worth and does not depend on information from other financial statements. The statement of cash flows uses two prior balance sheets to compare data-such as accounts receivables-to show the increase or decrease in the account as it impacts the cash flow. Operating income is gathered from the income statement.
The statement of cash flows consists of three sections: Cash flows from operating activities; cash flows from investing activities; and cash flows from financing activities.

Which Financial Statement Is Prepared Last Out of the Following