Only real accounts are extended to the statement of financial position Group of answer choicesTrueFalseNext

The statement that "Only real accounts are extended to the statement of financial position" is True.

Explanation:

1. Definition of Real Accounts: Real accounts (also known as permanent accounts) are those that relate to assets, liabilities, and equity on the statement of financial position (also known as the balance sheet). These accounts carry their balances over from one accounting period to the next.

2. Temporary Accounts: In contrast, temporary accounts (or nominal accounts) like revenues, expenses, and dividends are closed at the end of an accounting period and do not appear on the statement of financial position.

3. Financial Reporting: The statement of financial position is specifically designed to reflect the financial status of a company at a particular point in time, which includes only the ongoing balances from real accounts.

In summary, only real accounts are included in the statement of financial position, while temporary accounts are reported on the income statement and reset at the end of the accounting period.