Which sentence correctly distinguishes its from it's?

• A. It's indicates possession.
• B. Its is a contraction of 'it is'.
• C. Its indicates possession; it's a contraction of 'it is'.
• D. It's means belonging to it.

Answer: (C)

Distinguish its from it's by their roles: its shows ownership, and it's is a contraction for it is (and sometimes for it has). The sentence that says its indicates possession and it's a contraction of 'it is' uses both forms correctly, illustrating their distinct functions. For example, The company changed its policy. It's about to rain. That combination shows possession without an apostrophe and a contraction with one. Other statements mix up which form is possessive or treat the contraction incorrectly, which is why they’re not correct.