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FAQs on PPT: Preparation of Financial Statements - Advanced Accounting for CA Intermediate

1. What are the components of financial statements?
Ans. Financial statements typically include a balance sheet, income statement, cash flow statement, and statement of changes in equity.
2. What is the purpose of preparing financial statements?
Ans. The main purpose of preparing financial statements is to provide crucial information about a company's financial performance and position to various stakeholders such as investors, creditors, and management.
3. How often are financial statements prepared?
Ans. Financial statements are typically prepared at the end of each accounting period, which is usually quarterly or annually.
4. What are some common financial ratios used to analyze financial statements?
Ans. Some common financial ratios used to analyze financial statements include the debt-to-equity ratio, return on investment (ROI), earnings per share (EPS), and current ratio.
5. How can errors in financial statements be corrected?
Ans. Errors in financial statements can be corrected by preparing adjusting entries, restating financial statements, or making appropriate disclosures in the following period's financial statements.
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