Equity of a corporation is broken out into two components. Which of the following are the two components of the equity of a corporation?
A) current assets and fixed assets
B) common stock and liabilities
C) revenues and expenses
D) contributed capital and retained earnings

Question

Quizplus · Accepted Answer

The two components of the equity of a corporation are contributed capital (which includes common stock and additional paid-in capital) and retained earnings. Current assets and fixed assets are part of the assets of a corporation, while revenues and expenses are part of the income statement. Liabilities are a separate category from equity.

Equity of a Corporation Is Broken Out into Two Components