The statement of changes in equity serves as a connecting link between which other financial statements?
A) balance sheet and statement of cash flows.
B) income statement and expenses statement.
C) income statement and balance sheet.
D) statement of cash flows and income statement.

Question

Quizplus · Accepted Answer

The statement of changes in equity shows the changes in the equity of a company during a period. This statement connects the income statement and balance sheet since the net income reported in the income statement is used to determine the change in equity, which is reported on the balance sheet.

The Statement of Changes in Equity Serves as a Connecting