A financial statement:
A) summarises the measurements of financial performance and financial position
B) summarises the cash position of a business entity
C) analyses the financial performance of a business entity
D) analyses the business's ability to meet its financial obligations.

Question

Quizplus · Accepted Answer

A financial statement summarizes both the measurements of financial performance (profit and loss) and financial position (balance sheet). Financial statements provide an overview of a company's financial health and performance, allowing stakeholders to make informed decisions about investment, lending, and other financial activities. While financial statements may provide some analysis of a company's financial performance, their primary purpose is to provide a snapshot of financial health rather than analysis. The ability to meet financial obligations is assessed in part through analysis of a company's financial statements, but this is not their primary purpose.

A Financial Statement