Which of the following statements regarding the balance sheet is false?

  1. Buildings and equipment are reported at book value.
  2. Assets are reported in the order of liquidity.
  3. Current liabilities are obligations to be paid with current assets.
  4. The balance sheet reflects balances for a period of time.

Answer d. The balance sheet reflects balances for a period of time

Explanation: In accounting, a balance sheet report is a summary of the monetary balances of an individual or association, regardless of whether it be a business partnership, a sole proprietorship, an enterprise, a private limited company, a private limited company, a government or a not-for-profit entity.

Also see: MCQs on Balance Sheet

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