Which of the basic financial statements is best used to answer the questions "Where did the company's money come from and how was it spent over the preceding year?"
A) Balance sheet
B) Statement of shareholder's equity
C) Income statement
D) Cash flow statement
Which of the basic financial statements is best used to answer questions about changes in owner's equity that are not explained by the income statement?
A) Balance sheet
B) Statement of shareholder's equity
C) Income statement
D) Cash flow statement
The income statement shows a company's earnings since it has been in business.
Answer: FALSE
The balance includes information about the company's assets and liabilities.
Answer: TRUE
The cash flow statement shows amounts that the company has earned but for which it has not yet received cash.
Answer: FALSE
The cash flow statement is an alternative term for the balance sheet.
Answer: FALSE
