A characteristic of equity as specified in the Conceptual Framework is it:
A) ranks before liabilities as a claim on assets.
B) must be controlled by the entity.
C) is a residual.
D) is a present obligation.

Question

Quizplus · Accepted Answer

According to the Conceptual Framework, equity is defined as the residual interest in the assets of an entity after deducting liabilities. This means that it is the amount that remains after all liabilities have been satisfied. Therefore, option C - "Is a residual" is the correct choice.

A Characteristic of Equity as Specified in the Conceptual Framework