The part of the financial statements of a partnership that differs most from that of a sole trader is the:
A) assets section of the balance sheet.
B) equity section of the balance sheet.
C) income section of the income statement.
D) expense section of the income statement.

Question

Quizplus · Accepted Answer

The equity section of a partnership's balance sheet is different from that of a sole trader because it includes the capital contributions and share of profits/losses of each partner. A sole trader's equity section only includes the owner's capital contribution and retained earnings. The assets and income/expense sections of the financial statements for a partnership and a sole trader are relatively similar.

The Part of the Financial Statements of a Partnership That