The balance sheet identity refers to the fact that

A$.)$ Current Assets and Current Liabilities must

be equal to each other.

B$.)$ Shareholders equity in the current year must

equal shareholders equity in prior year plus net

income from the current year that is not being

paid out as dividends or used to repurchase

stock.

C$.)$ Assets must equal Liabilities plus

Shareholders' Equity.

D$.)$ Net Property Plant and Equipment must

equal Gross Property Plant and Equipment

minus Accumulated Depreciation.

E$.)$ Shareholders equity can never be negative.