The Balance Sheet Item That Represents the Portion of Owners

question 22

Multiple Choice

The balance sheet item that represents the portion of owners' equity resulting from profitable operations of the business is:

• A)Accounts receivable.
• B)Cash.
• C)Capital stock.
• D)Retained earnings.

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Definitions:

Statistically Significantly

A measure of confidence in statistical analysis indicating that the observed effect is unlikely to be due to chance.

Diversified Portfolio

An investment strategy that involves spreading investments across various asset classes to reduce risk and volatility.

Capital Market Line

A line used in the capital asset pricing model to illustrate the rates of return for efficient portfolios depending on the risk-free rate and the level of risk (variance).

Forecasted Return

The expected return on an investment based on models of analysis or historical performance data.