Which of the following represents the proper order of financial statement preparation?
A)Statement of cash flows,balance sheet,income statement,statement of owner's equity
B)Statement of owner's equity,income statement,statement of cash flows,balance sheet
C)Balance sheet,statement of cash flows,statement of owner's equity,income statement
D)Income statement,statement of owner's equity,balance sheet,statement of cash flows

Question

Quizplus · Accepted Answer

The proper order of financial statement preparation starts with the income statement, which calculates the net income or loss. This figure is then used in the statement of owner's equity to show changes in equity. The updated equity figure is needed for the balance sheet, which shows the company's financial position. Finally, the statement of cash flows is prepared, using information from the other three statements to show cash inflows and outflows.

Which of the Following Represents the Proper Order of Financial