During the fiscal year ending December 31, 20X1, Chao Corporation purchased inventory on account. As of December 31, 20X1, payment is due within 30 days. If you wanted to know whether Chao is able to pay for the inventory it purchased and you were given one financial statement, which one would tell you what you needed to know?
A) The Income Statement.
B) The Balance Sheet.
C) The Statement of Retained Earnings or Statement of Stockholders' Equity.
D) The Statement of Cash Flows.
Ans: B) The Balance Sheet.
Business
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