Asked by Tishera Brooks on May 09, 2024
Verified
The net income (or loss) for the period
A) is found by computing the difference between the income statement credit column and the balance sheet credit column on the worksheet.
B) cannot be found on the worksheet.
C) is found by computing the difference between the income statement columns of the worksheet.
D) is found by computing the difference between the trial balance totals and the adjusted trial balance totals.
Net Income
The total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue; also known as the bottom line.
Income Statement Credit Column
The section of the income statement where credit entries, typically revenues and gains, are recorded.
Balance Sheet Credit Column
The section of the balance sheet where liabilities and equity accounts are listed, typically reflecting sources of the company’s funds.
- Perceive the position and components of worksheets in the production of financial statements.
Verified Answer
KA
Kristen AzanaMay 10, 2024
Final Answer :
C
Explanation :
The net income (or loss) for the period is found by computing the difference between the income statement columns of the worksheet. The income statement columns of the worksheet show the revenues and expenses for the period, and the difference between the two is the net income or net loss. The other options are incorrect – choice A refers to the computation of net income (or loss) on the work sheet, but the procedure described is not correct, choice B is incorrect because the net income (or loss) can be found on the worksheet, and choice D refers to the computation of adjusted trial balance, which is a step in the accounting cycle, but does not directly result in the computation of net income (or loss).
Learning Objectives
- Perceive the position and components of worksheets in the production of financial statements.