The net income for an accounting period appears on the worksheet in the
A)Income Statement Credit column only.
B)Income Statement Credit and the Balance Sheet Debit columns.
C)Income Statement Debit and the Balance Sheet Credit columns.
D)Income Statement Debit column only.

Question

Quizplus · Accepted Answer

The net income is an amount that is calculated on the income statement, which means it will appear in the Income Statement Debit or Credit columns. Since it is a positive amount, it will appear in the Income Statement Credit column. However, to balance the worksheet, an entry must be made in the opposite column, which is the Balance Sheet Debit or Credit column. Since net income increases owner's equity, it is a credit entry on the income statement and a credit entry on the balance sheet, which means it will appear in the Income Statement Credit and the Balance Sheet Debit columns.

The Net Income for an Accounting Period Appears on the Worksheet