From the balance sheet of a company, it is possible to:
✓ Correct answer: c) determine the size and composition of the assets and liabilities of the company
ExplanationA balance sheet is a financial statement that provides a snapshot of a company’s financial position at a specific point in time.It details the company’s assets, liabilities, and share- holders’ equity, offering insights into its financial health, size, and resource allocation.However, it has limitations in assessing Indian Economy 263 profitability and market share.From a balance sheet, one can determine the size and composition of assets and liabilities, such as cash, inventory, debt, and equity.It does not directly reveal profitability (income statement) or market share (indus- try analysis).For example, Tata Motors’ balance sheet shows as- sets worth ₹1.2 lakh crore (2023), but profitability is assessed via P&L statements.99
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