Final answer:
The statement is true as a supporting schedule, like a reconciliation of amounts, details the transactions that comprise a year-end balance, ensuring the accuracy of financial statements.
Step-by-step explanation:
The statement 'An example of a supporting schedule is a reconciliation of amounts, which consists of the details that make up a year-end balance.' is True. A supporting schedule is an in-depth report created to provide details for the line items found in the main financial statements like the balance sheet or income statement. Its purpose is to reconcile and explain the amounts and transactions that have led to the final figures reported at the year-end balance.
For example, in a company’s financial statements, the total figure for inventory would be supported by a schedule that lists the different types of inventory on hand, their quantities, and their values, which all total up to the year-end balance. By providing transaction details, dates, and other relevant information, this schedule helps to clarify how the ending balance was reached and assures the accuracy of the financial statements. Such detailed documentation is crucial for auditors, tax authorities, and management review.