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O-LevelAccountingThe fundamentals of accounting7707/11 · May/June 2014 · Q11 Mark

Why does a trader prepare a statement of financial position?

Ato calculate the profit for the year
Bto check if assets equal capital plus liabilities
Cto show the transactions which took place during the year
Dto summarise what the business owns and what it owes

✓ Correct answer

D: to summarise what the business owns and what it owes

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About this question

Topic
The fundamentals of accounting, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source
O-Level Accounting, May/June 2014 Paper 1 Variant 1, question 1.

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