The balance sheet identity is which of the following?
A)Assets equal net worth minus liabilities.
B)Net worth equals assets plus the income statement.
C)Assets equal liabilities plus net worth.
D)Liabilities equal net worth minus assets.

Question

Quizplus · Accepted Answer

The balance sheet identity states that assets must equal liabilities plus net worth, since all assets must have been financed by either liabilities or equity. Therefore, the correct choice is C.

The Balance Sheet Identity Is Which of the Following