On which federal financial report would you look to see how much Individual Income Tax was as a percent of all revenues?

On which federal financial report would you look to see how much Individual Income Tax was as a percent of all revenues?

• A. Statement of Operations and Changes in Net Position
• B. Balance Sheet
• C. Statement of Net Cost
• D. Statement of Financial Position

Answer: (A)

Think about where the government shows its revenue sources. The Statement of Operations and Changes in Net Position breaks out revenues by major source (including Individual Income Tax) and shows the total revenues. That breakdown is what you’d use to determine what percentage the Individual Income Tax represents of all revenues. The Balance Sheet (Statement of Financial Position) shows assets and liabilities, not revenue mix; the Statement of Net Cost focuses on program costs rather than revenues. So, for figuring the share of total revenues from Individual Income Tax, use the Statement of Operations and Changes in Net Position and divide that tax by total revenues.

Think about where the government shows its revenue sources. The Statement of Operations and Changes in Net Position breaks out revenues by major source (including Individual Income Tax) and shows the total revenues. That breakdown is what you’d use to determine what percentage the Individual Income Tax represents of all revenues. The Balance Sheet (Statement of Financial Position) shows assets and liabilities, not revenue mix; the Statement of Net Cost focuses on program costs rather than revenues. So, for figuring the share of total revenues from Individual Income Tax, use the Statement of Operations and Changes in Net Position and divide that tax by total revenues.