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Which financial statement involves all aspects of the accounting equation?
Which financial statement involves all aspects of the accounting equation? a. Balance sheet
b. Profit-and-loss statement
c. Income statement
d. Statement of cash flows
e. Owners' equity statement
Final answer:The financial statement that involves all aspects of the accounting equation is the Balance sheet. The balance sheet is a statement of the assets, liabilities, and owners' equity of a business entity at a specific point in time. It follows the accounting equation: Assets = Liabilities + Owners' Equity.Explanation:The financial statement that involves all aspects of the accounting equation is the Balance sheet.The balance sheet is a statement of the assets, liabilities, and owners' equity of a business entity at a specific point in time. It shows the relationship between assets, which are the resources owned by the entity, and liabilities, which are the entity's obligations to external parties.The balance sheet follows the accounting equation: Assets = Liabilities + Owners' Equity. Therefore, it includes all three aspects of the accounting equation....