Which of the following is true of a balance sheet?
A) It summarizes the performance of the organization over a specific period of time.
B) It supplements information provided by the income statement.
C) It shows the financial position of an organization on a specific date.
D) It explains some changes in the assets and liabilities of a company between two consecutive periods.

Question

Quizplus · Accepted Answer

A balance sheet shows the financial position of an organization on a specific date, typically the end of a reporting period. It lists the assets, liabilities, and equity of the organization at that moment in time. It does not summarize performance over a period of time like an income statement, nor does it explain changes in assets and liabilities over time (that would be shown in a statement of cash flows or a statement of changes in equity). However, it does supplement information provided by the income statement by giving a snapshot of the financial health of the organization.

Which of the Following Is True of a Balance Sheet