Final answer:
The Profit & Loss by Class report allows businesses to track financial performance by segments or 'classes' and identifies transactions that have not been assigned to any class as 'unclassified', making it true that you can use the report to find unassigned. Correct answer is a. true.
Step-by-step explanation:
The short answer is true. The Profit & Loss by Class report in accounting software such as QuickBooks allows users to track income, expenses, and net profit by different segments or "classes" within the business. This is useful for organizations that need to monitor financial performance across different departments, locations, or product lines. If transactions are not assigned to any class, they will typically show up in an "unclassified" or similarly named section of the report. This makes it easier for users to identify and correct their classification for better financial tracking and reporting.
For example, if a business operates in multiple locations, you could assign each transaction to a class representing its location. When you run the Profit & Loss by Class report, you'll be able to see how each location is performing. Transactions that have not been assigned a class will be clearly visible, giving the user the opportunity to assign them to the correct class to ensure the accuracy of financial reports. Regularly reviewing this report can help in maintaining a cleaner set of books and more accurate financial analysis.
Therefore, when using a Profit & Loss by Class report, it is crucial to consistently apply classes to all transactions. Neglecting to do so can lead to incomplete data and could skew financial analysis. However, the report itself serves as a tool to find these unclassified transactions and remedy any issues related to transaction classification.