Which statement is true?
A)In the Income Statement columns of a worksheet, if there is net income, it must be added to the credit column to make the two columns balance.
B)In the Retained Earnings columns of a worksheet, if there is a loss, it will be entered in the credit column to make the two columns balance.
C)In the Income Statement columns of a worksheet, if there is a net loss, it must be added to the credit column to make the two columns balance.
D)In the Retained Earnings columns of a worksheet, if there is net income, it will be entered in the debit column to make the two columns balance.

Question

Quizplus · Accepted Answer

In the Income Statement columns of a worksheet, if there is a net loss, it must be entered in the credit column to make the two columns balance. This is because a net loss means that the expenses were greater than the revenues, resulting in a decrease in net income. Therefore, the balance in the credit column needs to be higher to reflect the decrease.

Which Statement Is True