The statement that measures an entity's financial position is the:
A) income statement.
B) balance sheet.
C) statement of cash flows.
D) statement of changes in equity.

Question

Quizplus · Accepted Answer

The balance sheet provides information about an entity's assets, liabilities, and equity, which together represent its financial position at a certain point in time. The income statement shows an entity's revenues and expenses over a certain period of time, the statement of cash flows shows the entity's cash inflows and outflows during a period, and the statement of changes in equity shows how the various components of equity have changed during a period. None of these statements provide a direct representation of an entity's financial position.

The Statement That Measures an Entity's Financial Position Is The