Question: When creating financial statements, why is it essential to create the income statement before the balance sheet? Because sales is an essential component of the

When creating financial statements, why is it essential to create the income statement before the balance sheet?\ Because sales is an essential component of the balance sheet\ Because net income is required to determine the balance in retained earnings\ Because cost of goods sold is a component of inventory\ Because S&A costs are required to determine the balance in Plant & Equipment (net).\ Actually, the balance sheet must always be created first and used to create the income statement.

When creating financial statements, why is it essential to create the income statement before the balance sheet? Because sales is an essential component of the balance sheet Because net income is required to determine the balance in retained earnings Because cost of goods sold is a component of inventory Because S\&A costs are required to determine the balance in Plant \& Equipment (net). Actually, the balance sheet must always be created first and used to create the income statement

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