On the balance sheet, for every dollar of assets there must be a dollar of financing in the form of debt or _____.
A) owner's equity
B) accounts receivable
C) accumulated depreciation
D) net profit

Question

Quizplus · Accepted Answer

The balance sheet equation is Assets = Liabilities + Owner's Equity. This means that for every dollar of assets (the left side of the equation), there must be a corresponding dollar of financing in the form of either liabilities (debt) or owner's equity (investment by the owners). Accounts receivable and accumulated depreciation are both specific types of assets, and net profit is not a form of financing.

On the Balance Sheet, for Every Dollar of Assets There