The best description of the relationship between the statement of comprehensive income and the balance sheet is:
A) The opening balance sheet plus the profit equals the closing balance sheet.
B) There is no direct relationship between the income statement and the balance sheet.
C) The income statement explains the change in equity that arises from operating activities.
D) The balance sheet is the link between two income statements.

Question

Quizplus · Accepted Answer

The income statement (also referred to as the statement of comprehensive income) explains the change in equity that arises from operating activities by detailing the revenues earned and expenses incurred over a period. This change in equity is then reflected in the equity section of the balance sheet.

The Best Description of the Relationship Between the Statement of Comprehensive