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Home Questions EJ9W2JSP58
Target Exam

CUET

Subject

Accountancy

Chapter

Analysis of Financial Statements

Question:

There are two statements marked as Assertion (A) and Reason (R). Mark your answer as per the codes provided below-
Assertion: The Balance Sheet is a list of assets and liabilities of the company presented in the specified format for the year ended on that date.

Reasoning: The Balance Sheet is a statement of assets and liabilities of the company as on a particular date.

Options:

Both Assertion (A) and reasoning (R) are correct and R is the correct explanation of A.

Both Assertion (A) and reasoning (R) are correct and but R is not the correct explanation of A.

Assertion (A) is true but Reasoning (R) is not correct.

Assertion (A) is not true but Reasoning (R) is correct.

Correct Answer:

Assertion (A) is not true but Reasoning (R) is correct.

Explanation:
The Balance Sheet is a financial statement that provides a snapshot of a company's assets and liabilities as of a specific date, commonly the end of the fiscal year. It represents the financial position of the company at that particular moment in time. The Balance Sheet is not a list of assets and liabilities "for the year ended on that date." Instead, it presents the company's financial position as of a specific date, such as December 31st of a given year. The Balance Sheet is a static report that captures the financial situation at a particular point in time, not for a specific period.

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