Which Statement Below Best Describes the Accounting Equation

question 170

Multiple Choice

Which statement below best describes the accounting equation?

• A)The change in retained earnings equals net income less dividends.
• B)Equality of revenue and expense transactions over time.
• C)Resources of the company equal creditors' and owners' claims to those resources.
• D)Financing activities equal investing and operating activities.

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Definitions:

Direct Labor

The labor costs directly associated with the manufacturing of a product, including wages of workers physically involved in production.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time.

Direct Materials

The raw materials that are directly traceable to the manufacturing of a product.

Organizational Objectives

The specific, measurable goals set by a business or organization to guide operations and strategic planning.