Question 14 of 29beginner💡 UnderstandTrue / False1 mark

Statement of profit and loss account shows the operating performance of an enterprise for a period of time.

Correct Answer

True. The Statement of Profit and Loss is a summarised financial report that provides the operating results of a company. It summarises the operational activities of different periods, which helps in assessing the operational efficiency and performance of the enterprise.

Exercise: Test your Understanding – III | Q: g | (Page 17)
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Explanation

The provided context explicitly states that financial statements provide the 'operating results' and 'summaries of different operational activities of different periods'. It further mentions that comparative statements apply to the statement of profit and loss to show profitability for 'different periods of time', confirming that this statement reflects performance over a period.