A Level Accounting (9706)•9706/12/M/J/25
Explanation
Statement of Changes in Equity Components Steps:
- Identify standard items in the statement of changes in equity per IAS 1: total comprehensive income, owner transactions, dividends, and retained earnings reconciliation.
- Assume items 1–4 refer to common elements like profit/loss (1), dividends (2), comprehensive income (3), and owner contributions (4).
- Match choices to required disclosures: must include profit/loss and owner transactions.
- Eliminate options lacking these core items.
Why B is correct:
- IAS 1 requires the statement to show profit or loss (item 1) and transactions with owners in their capacity as owners (item 4), reconciling equity changes.
Why the others are wrong:
- A omits owner transactions, focusing only on income/dividends.
- C lacks profit/loss, including irrelevant comprehensive income/dividends combo.
- D excludes profit/loss, showing only comprehensive income/owner transactions.
Not enough information on exact items 1–4, but B aligns with standards. Final answer: B
Topic: Preparation of financial statements
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