Prepare End-of-Period Spreadsheet - Why and How?

Why do some accountants prepare an end-of-period spreadsheet?

a) To calculate taxes

b) To track inventory

c) To analyze financial performance

d) To create marketing materials

Final answer:

An end-of-period spreadsheet is primarily used by accountants to analyze the financial performance of a business.

Explanation:

Accountants prepare an end-of-period spreadsheet mainly to analyze financial performance. This involves evaluating the progress and current state of a business by analyzing its financial statements. It enables the understanding of income, expenses, assets, liabilities, and equity. These elements help in training an accurate picture of a company's profitability and financial health.

An end-of-period spreadsheet or worksheet comprises of a balance sheet, income statement, and cash flow statement, that provide comprehensive insights into a company's financial status. It can help in making important business decisions, budgeting and forecasting, and identifying areas where cost-saving measures can be implemented.

While an end-of-period spreadsheet can also assist in calculating taxes and tracking inventory, its primary function serves towards analyzing the financial health of the entity. Therefore, the correct answer to this question is: c) To analyze financial performance.