A. Assets = Liabilities + Capital
B. Liabilities = Assets + Capital
C. Capital = Assets + Liabilities
D. All of these

Solution

A. Assets = Liabilities + Capital

Explanation

The balance sheet displays the company’s total assets, and how these assets are financed, through either debt or equity. It can also be referred to as a statement of net worth, or a statement of financial position. The balance sheet is based on the fundamental equation: Assets = Liabilities + Equity(Capital).