Which statement is prepared for only one date?
Income Statement
Statement of Cash Flows
Balance Sheet
Statement of Owner’s Equity
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The statement that is typically prepared for only one date is the Balance Sheet.
To understand why, let's briefly explain what each of these financial statements represents:
1. Income Statement: This statement summarizes a company's revenues, expenses, and net income or loss over a specific period of time, such as a month, quarter, or year. It shows the company's financial performance during that period.
2. Statement of Cash Flows: This statement provides information about the cash inflows and outflows of a company during a specific period, typically a month, quarter, or year. It categorizes the cash flows into operating, investing, and financing activities.
3. Balance Sheet: This statement shows the financial position of a company at a specific point in time, typically the end of a financial reporting period, such as a month, quarter, or year. It presents the company's assets, liabilities, and shareholders' equity.
4. Statement of Owner’s Equity: This statement reflects the changes in the owner's equity (shareholder's equity for publicly traded companies) of a business over a specific period. It starts with the beginning balance of owner's equity, adds contributions and net income, and deducts withdrawals and net losses.
Out of these statements, the Balance Sheet is prepared for only one specific date and provides a snapshot of a company's financial position at that specific moment in time. Other financial statements represent activities or changes occurring over a specific period.