Which of the Following Equations Is Equivalent to the Accounting

question 35

Multiple Choice

Which of the following equations is equivalent to the accounting equation?

• A) Equity = liabilities - assets
• B) Owners' equity = assets - liabilities
• C) Revenues - expenses = net income
• D) Net income = expenses - revenues + taxes
• E) Profit = sales - revenues

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Definitions:

Accounts Receivable Turnover

A financial ratio that measures how efficiently a company collects revenue from its credit sales, calculated by dividing net credit sales by the average accounts receivable.

Sales In Receivables

Likely refers to the concept of "Accounts Receivables" which are amounts owed by customers for goods or services delivered on credit.

Decimal Place

The position of a number to the right of the decimal point; each position represents a power of ten.

Comparative Income Statement

A financial statement that compares income, expenses, and net profit over multiple periods to assess performance.