The firm's financial position with respect to assets and liabilities at a specific point in time is shown by its:
A) activity ratio.
B) profitability ratio.
C) income statement.
D) liquidity ratio.
E) balance sheet.

Question

Quizplus · Accepted Answer

The balance sheet shows a company's financial position at a specific point in time by indicating its assets and liabilities. The other options (activity ratio, profitability ratio, income statement, and liquidity ratio) do not provide a snapshot of a company's overall financial position.

The Firm's Financial Position with Respect to Assets and Liabilities