Asked by Adrian Barrera on Jun 03, 2024
Verified
After the account balances have been extended from the Adjusted Trial Balance columns on the work sheet, the difference between the initial totals of the Balance Sheet Debit and Credit columns is net income or net loss.
Balance Sheet Debit
An entry on the left side of a balance sheet, typically indicating an increase in assets or a decrease in liabilities or equity.
Net Income
Profits after subtracting all costs, including operating expenses, interest, and taxes, from total revenue, indicating the final earning outcome of a business.
- Evaluate whether there is a net gain or shortfall derived from the worksheet columns.
Verified Answer
ZK
Zybrea KnightJun 05, 2024
Final Answer :
True
Explanation :
The difference between the initial totals of the Balance Sheet Debit and Credit columns after extending account balances from the Adjusted Trial Balance on the work sheet represents the company's net income (if credits exceed debits) or net loss (if debits exceed credits). This difference is necessary to balance the two sides of the balance sheet.
Learning Objectives
- Evaluate whether there is a net gain or shortfall derived from the worksheet columns.
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