Which document shows the assets and liabilities of a business at a specific date?

• A. Income statement
• B. Cash flow statement
• C. Statement of changes in equity
• D. Balance sheet

Answer: (D)

A balance sheet provides a snapshot of a business’s financial position at a specific date. It lists what the company owns (assets) and what it owes (liabilities), with owners’ equity representing the residual interest. This moment-in-time view contrasts with other statements that cover flows over a period: the income statement summarizes revenue and expenses to show profit or loss over a period; the cash flow statement tracks cash movements during a period; and the statement of changes in equity shows how owners’ equity changed over a period. Because a balance sheet captures assets and liabilities at a single date, it’s the document that shows the financial position at that moment.