On the income statement, revenues are increased by a debit whereas on the statement of financial position retained earnings is increased by a credit.

Question

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This statement is incorrect. On the income statement, revenues are increased by a credit while expenses are increased by a debit. On the statement of financial position, retained earnings are increased by a credit while expenses and distributions (dividends) decrease retained earnings, and therefore are debited.

On the Income Statement, Revenues Are Increased by a Debit