Question

Financial statements are:

a) Reports issued by outside consultants who are hired to analyze key operations of the business
b) Reports created by management that states it is responsible for the acts of the corporation
c) Standard documents issued by outside consultants who are hired to analyze key operations of the business in financial terms
d) Standard documents that tell us how well a business is performing and where it stands in financial terms

Answer 1

Financial statements are standard documents that show a company's financial performance and position. They are created by management and include the balance sheet, income statement, and cash flow statement. The correct option is d.

Step-by-step explanation:

Financial statements are standard documents that tell us how well a business is performing and where it stands in financial terms. They are created by management and provide a snapshot of a company's financial condition. Financial statements include the balance sheet, income statement, and cash flow statement.

The balance sheet shows the company's assets, liabilities, and equity at a specific point in time. The income statement shows the company's revenues, expenses, and net income over a period of time. The cash flow statement shows the company's cash inflows and outflows.

These statements are important for investors, creditors, and other stakeholders to evaluate the financial health and performance of a business. The correct option is d.