What is defined as financing provided by owners and operations of the company?

The correct answer, equity, refers to the financing that is provided by the owners of a company, alongside the profits that the company generates from its operations. Equity represents the residual interest in the assets of a company after deducting liabilities. Essentially, it is the amount that the owners or shareholders claim on the assets of the business, which can include initial investments as well as retained earnings that have not been distributed as dividends.

In accounting, equity is an essential concept because it reflects the true ownership stake in the company. It can be expressed in several forms, such as common stock, preferred stock, and retained earnings. A company with a strong equity position is generally viewed as more financially stable because it indicates that it has more resources that belong to its owners rather than being financed through debts.

The other options represent different financial concepts. Assets are resources owned by the company that provide future economic benefits. Debts are obligations or amounts that the company owes to external parties, resulting in liabilities. Liabilities are a broader category that includes debts and represent claims against the company's assets from creditors. Understanding these distinctions helps clarify why equity is specifically tied to ownership and operations, making it the correct choice in this context.