bank and income statements quick check\nwhich is the best description of a balance sheet? (1 point)\na list…
bank and income statements quick check\nwhich is the best description of a balance sheet? (1 point)\na list of outstanding debt compared to revenue\na statement that balances assets to liabilities and equity\na statement listing retained earnings\na comparison of revenue to sg&a and cogs
Answer
Brief Explanations:
A balance sheet is based on the accounting equation ( Assets = Liabilities + Equity ). It presents a company's financial position at a specific point in time by showing its assets (what it owns), liabilities (what it owes), and equity (the residual interest of owners).
- The first option about debt compared to revenue is not the main focus of a balance sheet. Revenue and debt - related aspects (like interest expense on debt) are more relevant to the income statement.
- Retained earnings are part of equity on the balance sheet, but a balance sheet is not just about listing retained earnings. It encompasses all assets, liabilities, and equity components.
- The comparison of revenue to SG&A (Selling, General and Administrative expenses) and COGS (Cost of Goods Sold) is the domain of the income statement, which calculates net income.
Answer:
a statement that balances assets to liabilities and equity