Which component is included in the balance sheet?

Retained earnings are included in the balance sheet as they represent the cumulative amount of net income that has been retained in the company instead of being distributed to shareholders as dividends. This figure is important as it provides insight into the company’s ability to reinvest in itself, fund growth opportunities, and maintain financial stability over time. Retained earnings reflect the company's past performance and are adjusted for any profits or losses as well as dividends paid out in the reporting period.

In contrast, revenue from sales is reported on the income statement, which measures the company's performance over a specific period. Rent expense also appears on the income statement, as it reflects costs incurred during that time frame. Cash flow from operations, while critical for understanding liquidity and operational efficiency, is detailed in the cash flow statement rather than the balance sheet. Thus, retained earnings is the only component on the list that directly belongs to the balance sheet, showcasing the company's historical profitability and retained capital.