Final answer:
The elements of the financial statements include Revenues, Expenses, Gains, Losses, Assets, Liabilities, and Equity, which can be remembered through the mnemonic 'REGL ALE needs ID'.
Step-by-step explanation:
The elements of the financial statements include Revenues, Expenses, Gains, Losses, Assets, Liabilities, and Equity. These are represented by the mnemonic 'REGL ALE needs ID', which can help recall:
- Revenues - inflows of resources resulting from providing goods or services to customers.
- Expenses - outflows or using up of assets as part of operations of the business to generate revenues.
- Gains - increases in equity from peripheral or incidental transactions of an entity.
- Losses - decreases in equity from peripheral or incidental transactions.
- Assets - resources controlled by the entity as a result of past events and from which future economic benefits are expected to flow to the entity.
- Liabilities - present obligations of the entity arising from past events, the settlement of which is expected to result in an outflow from the entity of resources embodying economic benefits.
- Equity - the residual interest in the assets of the entity after deducting liabilities