Which of the following basic elements of financial statements is more associated with the statement of financial position than the income statement?
A) Equity.
B) Income.
C) Gains.
D) Expenses.

Question

Quizplus · Accepted Answer

Equity is a basic element of financial statements that is more associated with the statement of financial position (also known as the balance sheet) than the income statement. This is because the statement of financial position shows the shareholder's equity or owner's equity, which represents the residual interest in the assets after deducting liabilities. The income statement, on the other hand, shows the revenues and expenses of a company during a specified period.

Which of the Following Basic Elements of Financial Statements Is