Question

Personal financial statements are a good way of measuring our current finances and giving us information about our financial activities.

A
B.
True
False

Answer 1

true

Step-by-step explanation:

Personal financial statements are snapshots of your financial situation, including your income and spending. These statements are beneficial for several reasons. They are a good way of measuring our current finances and giving us information about our financial activities. For example, if you find that you are consistently going over your budget each month, a personal financial statement can help you identify where the money is going, and then you can either reassess your budget or eliminate unneeded spending that causes you to go over your budget. Personal financial statements are also a great way to measure progress on financial goals. By looking at financial statements over a period of time, you can see how much you've progressed in saving for a particular goal, for example.

There are two main types of personal financial statements: personal balance sheets and cash flow statements. Let's take a look at how to create each of these types of personal financial statements and the benefits that each provides to us.

Answer 2

The above statement is absolutely true.

Step-by-step explanation:

Personal financial statements can be helpful in keeping the record of the expenses in different resources. They also help to account for the family income and expenditures and regulate and maintain them.

Making personal financial statements can additionally help with the planning of the budget and show the indication of one’s financial conditions. Keeping the record of groceries, gas, utility bills, rents, taxes, recreation expenses, etc.

And determining the inflow and outflow of cash through the financial statement helps to find the net cash flow. This shows if you are spending more than you earn and can help in regulating the cash inflow and outflow and also control the budget.