Western Company has an annual reporting period that runs from July 1 through June 30.Based on this information,which of the following is a true statement?
A)Western probably has little seasonal variation in their sales.
B)Western has violated the time period principle.
C)Western must prepare financial statements as of December 31 each year.
D)Western has adopted a fiscal year.
E)Western does not have an accountant.

Question

Quizplus · Accepted Answer

Western has adopted a fiscal year, which is a 12-month period that does not coincide with the calendar year. In this case, their fiscal year runs from July 1 through June 30. This is a common practice for businesses and organizations. Option A cannot be determined from the information given, option B is incorrect as the company has not violated any principle, option C is incorrect as Western is not required to prepare financial statements as of December 31, and option E is irrelevant as the question does not provide any information about the company's accounting department.

Western Company Has an Annual Reporting Period That Runs from July