- CFA Exams
- CFA Level I Exam
- Topic 4. Financial Statement Analysis
- Learning Module 4. Analyzing Statements of Cash Flows I
- Subject 1. Linkages Between the Financial Statements
CFA Practice Question
The statement of stockholders' equity ______
B. reports the total number of shares of contributed capital.
C. may be used in place of the statement of retained earnings.
A. reports cash flows affecting stockholders' equity accounts.
B. reports the total number of shares of contributed capital.
C. may be used in place of the statement of retained earnings.
Correct Answer: C
The stockholders' equity section of the balance sheet, not the statement of stockholders' equity, reports the total number of shares of contributed capital. The statement of stockholders' equity summarizes changes in the components of the stockholders' equity section of the balance sheet. It may be used in place of the statement of retained earnings because it reveals much more about the year's stockholders' equity transactions.
User Contributed Comments 2
| User | Comment |
|---|---|
| ayep | A is incorrect as it does not only report cashflows B is incorrect because it records monetary values and not shares |
| verter2k | In A there is no word "only" though. B is wrong as well. |