Question

Which of the following types of entities follow FASB standards when preparing financial statements?

1) Corporations
2) Partnerships
3) Sole Proprietorships
4) All of the above

Answer 1

All types of business entities, including Corporations, Partnerships, and Sole Proprietorships, follow Financial Accounting Standards Board (FASB) standards when preparing financial statements. Thus, the correct option is "4-All of the above"

Step-by-step explanation:

The Financial Accounting Standards Board (FASB) standards are applied to a variety of business entities in the United States when preparing their financial statements. This includes 1) Corporations, 2) Partnerships, and 3) Sole Proprietorships. Essentially, FASB standards are followed by all of the above types of business organizations when they prepare their financial statements to ensure consistency, comparability, and reliability in financial reporting, which is crucial for investors, regulators, and the overall functioning of the economy.