The amount of net income will appear on the debit side of the Income Statement columns on a work sheet,
A) if total revenue exceeded total expenses for the period.
B) if withdrawals have been made during the period.
C) if total assets exceeded total liabilities for the period.
D) if total expenses exceeded total revenue for the period.
E) if net income exceeds the owner's withdrawals.

Question

Quizplus · Accepted Answer

Net income represents the excess of total revenue over total expenses, so if total revenue exceeded total expenses for the period, net income will appear on the debit side of the Income Statement columns on a work sheet. Withdrawals and assets and liabilities do not directly affect net income. If total expenses exceeded total revenue, then the result would be a net loss, which would appear on the credit side of the Income Statement columns.

The Amount of Net Income Will Appear on the Debit