Worldatwork Exam T7 Topic 1 Question 95 Discussion

Actual exam question for Worldatwork's T7 exam

Question #: 95
Topic #: 1

[All T7 Questions]

What is the purpose of a balance sheet?

ATo show sources of funds and the manner in which those funds are employed

BTo account for changes in cash during the accounting period

CTo show details of the nature of a company's operating activities

DTo reconcile the beginning and ending balances of stockholders' equity

Show Suggested Answer

Suggested Answer: A

by Fallon at Aug 27, 2024, 12:39 AM

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Franklyn

3 months ago

I agree with option A, as it gives a clear picture of where the company's money is coming from and how it is being utilized.

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Mollie

3 months ago

D is tempting, but I don't think it's the primary purpose of the balance sheet. That's more the job of the statement of changes in stockholders' equity.

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Stanton

3 months ago

Haha, I bet the person who wrote this question was just trying to trip us up. The balance sheet is clearly about the assets and liabilities, not the operating activities.

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Lorean

2 months ago

D) To reconcile the beginning and ending balances of stockholders' equity

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Lorean

2 months ago

A) To show sources of funds and the manner in which those funds are employed

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Billye

3 months ago

I'm torn between A and B, but I think A is the best answer. It's all about the sources and uses of funds. The cash flow statement deals with the changes in cash.

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Armando

3 months ago

Option A is the way to go. The balance sheet tells you where the company's money comes from and how it's being used. Gotta keep track of those funds, you know.

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Tonette

2 months ago

Absolutely, it's important to keep track of where the company's money is coming from and how it's being utilized.

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Gearldine

3 months ago

Option A is definitely the right choice. It shows sources of funds and how they are used.

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Lonny

3 months ago

I believe option A is correct because it provides a snapshot of a company's financial health.

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Effie

3 months ago

I think it also helps in understanding the financial position of a company.

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The balance sheet is like a snapshot of a company's financial health. It shows what the company owns (assets) and what it owes (liabilities) at a specific point in time. Pretty straightforward if you ask me.

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Brittni

2 months ago

C) To show details of the nature of a company's operating activities

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Jettie

2 months ago

B) To account for changes in cash during the accounting period

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Annamaria

3 months ago

A) To show sources of funds and the manner in which those funds are employed

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Miesha

4 months ago

The purpose of a balance sheet is to show sources of funds and how they are used.

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Worldatwork Exam T7 Topic 1 Question 95 Discussion

Contribute your Thoughts:

Franklyn

Mollie

Stanton

Lorean

Lorean

Billye

Armando

Tonette

Gearldine

Lonny

Effie

Cyril

Brittni

Jettie

Annamaria

Miesha