Question

Which of the statements below is​ FALSE? A. The balance sheet reports the performance of the firm over the past period. It summaries and categorizes a​ company's revenues and expenses for that period. B. The income statement summaries and categorizes a​ company's revenues and expenses for that period. C. The income statement begins with revenue and subtracts various operating expenses until arriving at Earnings Before Interest and Taxes​ (EBIT). D. ​Typically, income statements are prepared quarterly and annually for distribution outside the​ company, but usually monthly for internal managers.

Answer 1

Answer:

A. The balance sheet reports the performance of the firm over the past period. It summaries and categorizes a​ company's revenues and expenses for that period.

Explanation:

The balance sheet is a financial document or statement that shows a company's total assets at a particular time. It indicates how the assets are financed. A balance sheet reports the net worth of a business. It shows the assets, the liabilities, and the shareholders' equity.  

The preparation of a balance sheet follows the principle of assets equals the sum of liabilities and equity.  It does not record incomes of expenses of a business for a financial year. The income statement is the financial report that shows the revenue and expenses of a company in a period.