What part of the lensatic compass houses the floating dial and contains a fixed black index line?

The glass encasement is the correct part of the lensatic compass that houses the floating dial and features a fixed black index line. In a lensatic compass, the floating dial is critical for indicating direction; it is mounted in a way that allows it to move freely, providing accurate readings without obstruction. The fixed black index line, usually found within this encasement, serves as a reference point for aligning the compass with magnetic north.

The other components play different roles. The outer shell serves as the protective casing for the compass but does not assist in the direct function of displaying the magnetic heading. The dial cover typically protects the dial from damage but does not contain the elements that provide the compass's directional readout. The lens is primarily used for magnifying the dial and aiding in reading the compass more effectively, rather than housing the dial itself. Thus, the glass encasement is essential for the compass's functionality in relation to direction determination.